Finding 2023-001 – ReportingInformation of the federal program:Federal Grantor: Department of Defense (DOD)Assistance Listing No.: 12.420, Military Medical Research and DevelopmentPass-Through Grantor: Johns Hopkins UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.172, Human Genome ResearchPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.226, Research on Healthcare Costs, Quality and OutcomesPass-Through Grantor: The Regents of the University of MichiganFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.242, Mental Health Research GrantsPass-Through Grantor: Rutgers State UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.307, Minority Health and Health Disparities ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.310, Trans-NIH Research SupportPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.350, National Center for Advancing Translational SciencesPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.351, Research Infrastructure ProgramPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.361, Nursing ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.368, 21st Century Cures Act – Precision Medicine InitiativePass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.394, Cancer Detection and Diagnosis ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.395, Cancer Treatment ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.396, Cancer Biology ResearchPass-Through Grantor: Tulane University, Louisiana State UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.397, Cancer Centers Support GrantsPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.667, Social Services Block GrantPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.837, Cardiovascular Diseases ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.838, Lung Diseases ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.847, Diabetes, Digestive, and Kidney Diseases Extramural ResearchPass-Through Grantors: Northwestern University, Duke University, University of Washington, The Regents of University of MichiganFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.853, Extramural Research Programs in the Neurosciences and Neurological DisordersPass-Through Grantor: Rush University Medical CenterFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.855, Allergy, Immunology and Transplantation ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.859, Biomedical Research and Research TrainingPass-Through Grantor: University of Wisconsin – MadisonFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.865, Child Health and Human Development Extramural ResearchPass-Through Grantors: Northwestern University, University of Washington, The Regents of the University of CaliforniaFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.866, Aging ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.946, Cooperative Agreements to Support State-Based Safe Motherhood and Infant Health Initiative ProgramsPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.994, Maternal and Child Health Services Block Grant to the StatesPass-Through Grantor: Northwestern Memorial HospitalCriteria or specific requirement (including statutory, regulatory, or other citation):Section 200.303 of the Uniform Guidance states the following regarding internal control: “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).”The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.”Condition:Certain grants related to the Research and Development Cluster were misstated by $233,405 on the preliminary schedule of expenditures of federal awards (the Schedule) provided by management due to the inappropriate classification of costs within the general ledger; the final Schedule was corrected.In addition, an award which was not a federal grant award with expenditures of $148,388 was included on the preliminary Schedule provided by management. The final Schedule was corrected.Cause:Endeavor’s internal controls in place over the preparation of the Schedule were not sufficient to properly accumulate and accurately report all expenditures of federal awards.Effect or Potential Effect:Inaccurate or improper reporting of expenditures results in a misstated Schedule and can also potentially result in insufficient testing of the major programs or improper identification of major programs for audit purposes.Questioned costs:None.Context:The table below reflects the preliminary and adjusted assistance listing balances on the Schedule (only assistance listing programs which changed are included below):Identification as a repeat finding, if applicable:The finding is not a repeat finding from the prior year.Recommendation:Management should implement internal controls to ensure amounts are appropriately accumulated and reported on the Schedule and all federal expenditures are appropriately identified and reported on the Schedule.Views of responsible officials:Award amounts were changed on the Schedule after management’s review was executed. Management acknowledges that implementing the new Enterprise Resource Planning (ERP) system, in 2023 presented changes to the SEFA reporting. Management has identified and addressed the reporting issues within the new system to ensure that the grant totals are appropriately captured in the SEFA.Endeavor will enhance grant management award processes by revising its procedures and adding additional controls to monitor for accuracy of the core data. Management will reinforce the importance of timeliness and accuracy of the Schedule reporting totals to facilitate accurate reporting.
Finding 2023-006 – Reporting – SEFA Preparation Information of the federal program:Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 21.027, Coronavirus State and Local Fiscal Recovery Fund Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “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).” The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.” Condition: Endeavor did not provide a complete and accurate listing of all federal awards in the SEFA. Cause:Endeavor did not include all funds expended under the Coronavirus State and Local Fiscal Recovery Fund on the SEFA. Effect or potential effect:The SEFA prepared by Endeavor in fiscal year 2023 was misstated but was subsequently corrected. Themisstated SEFA resulted in the improper identification of federal award major programs, and therefore resulted in a restatement of a previously issued Uniform Guidance report. Questioned costs:None Context:Expenditures for ALN 21.027 were understated by $1,399,999, which resulted in the program being identified as a major program upon inclusion of the costs. Identification as a repeat finding, if applicable:This finding is not a repeat finding. Recommendation:Endeavor should review its internal controls over the process of accumulating and reporting expenditures of federal awards to ensure a completed and accurate SEFA presentation. Views of responsible officials:The grant was received and expended during a period that overlapped fiscal years, and internal miscommunication led to its initial exclusion from the SEFA submitted for audit. Management will enhance the SEFA preparation process by revising its procedures and adding additional controls to monitor for completeness of the data. This will include comparisons to the prior year programs, enhancing the Company’s grant tracking process, and review of the SEFA with key stakeholders. Upon identification of the omission, management reviewed the grant activity and has taken corrective action to ensure proper inclusion in future SEFA reports.
Finding 2023-001 – ReportingInformation of the federal program:Federal Grantor: Department of Defense (DOD)Assistance Listing No.: 12.420, Military Medical Research and DevelopmentPass-Through Grantor: Johns Hopkins UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.172, Human Genome ResearchPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.226, Research on Healthcare Costs, Quality and OutcomesPass-Through Grantor: The Regents of the University of MichiganFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.242, Mental Health Research GrantsPass-Through Grantor: Rutgers State UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.307, Minority Health and Health Disparities ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.310, Trans-NIH Research SupportPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.350, National Center for Advancing Translational SciencesPass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.351, Research Infrastructure ProgramPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.361, Nursing ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.368, 21st Century Cures Act – Precision Medicine InitiativePass-Through Grantor: University of ChicagoFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.394, Cancer Detection and Diagnosis ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.395, Cancer Treatment ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.396, Cancer Biology ResearchPass-Through Grantor: Tulane University, Louisiana State UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.397, Cancer Centers Support GrantsPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.667, Social Services Block GrantPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.837, Cardiovascular Diseases ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.838, Lung Diseases ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.847, Diabetes, Digestive, and Kidney Diseases Extramural ResearchPass-Through Grantors: Northwestern University, Duke University, University of Washington, The Regents of University of MichiganFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.853, Extramural Research Programs in the Neurosciences and Neurological DisordersPass-Through Grantor: Rush University Medical CenterFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.855, Allergy, Immunology and Transplantation ResearchPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.859, Biomedical Research and Research TrainingPass-Through Grantor: University of Wisconsin – MadisonFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.865, Child Health and Human Development Extramural ResearchPass-Through Grantors: Northwestern University, University of Washington, The Regents of the University of CaliforniaFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.866, Aging ResearchFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.946, Cooperative Agreements to Support State-Based Safe Motherhood and Infant Health Initiative ProgramsPass-Through Grantor: Northwestern UniversityFederal Grantor: United States Department of Health and Human Services (HHS)Assistance Listing No.: 93.994, Maternal and Child Health Services Block Grant to the StatesPass-Through Grantor: Northwestern Memorial HospitalCriteria or specific requirement (including statutory, regulatory, or other citation):Section 200.303 of the Uniform Guidance states the following regarding internal control: “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).”The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.”Condition:Certain grants related to the Research and Development Cluster were misstated by $233,405 on the preliminary schedule of expenditures of federal awards (the Schedule) provided by management due to the inappropriate classification of costs within the general ledger; the final Schedule was corrected.In addition, an award which was not a federal grant award with expenditures of $148,388 was included on the preliminary Schedule provided by management. The final Schedule was corrected.Cause:Endeavor’s internal controls in place over the preparation of the Schedule were not sufficient to properly accumulate and accurately report all expenditures of federal awards.Effect or Potential Effect:Inaccurate or improper reporting of expenditures results in a misstated Schedule and can also potentially result in insufficient testing of the major programs or improper identification of major programs for audit purposes.Questioned costs:None.Context:The table below reflects the preliminary and adjusted assistance listing balances on the Schedule (only assistance listing programs which changed are included below):Identification as a repeat finding, if applicable:The finding is not a repeat finding from the prior year.Recommendation:Management should implement internal controls to ensure amounts are appropriately accumulated and reported on the Schedule and all federal expenditures are appropriately identified and reported on the Schedule.Views of responsible officials:Award amounts were changed on the Schedule after management’s review was executed. Management acknowledges that implementing the new Enterprise Resource Planning (ERP) system, in 2023 presented changes to the SEFA reporting. Management has identified and addressed the reporting issues within the new system to ensure that the grant totals are appropriately captured in the SEFA.Endeavor will enhance grant management award processes by revising its procedures and adding additional controls to monitor for accuracy of the core data. Management will reinforce the importance of timeliness and accuracy of the Schedule reporting totals to facilitate accurate reporting.
Finding 2023-006 – Reporting – SEFA Preparation Information of the federal program:Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 21.027, Coronavirus State and Local Fiscal Recovery Fund Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “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).” The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.” Condition: Endeavor did not provide a complete and accurate listing of all federal awards in the SEFA. Cause:Endeavor did not include all funds expended under the Coronavirus State and Local Fiscal Recovery Fund on the SEFA. Effect or potential effect:The SEFA prepared by Endeavor in fiscal year 2023 was misstated but was subsequently corrected. Themisstated SEFA resulted in the improper identification of federal award major programs, and therefore resulted in a restatement of a previously issued Uniform Guidance report. Questioned costs:None Context:Expenditures for ALN 21.027 were understated by $1,399,999, which resulted in the program being identified as a major program upon inclusion of the costs. Identification as a repeat finding, if applicable:This finding is not a repeat finding. Recommendation:Endeavor should review its internal controls over the process of accumulating and reporting expenditures of federal awards to ensure a completed and accurate SEFA presentation. Views of responsible officials:The grant was received and expended during a period that overlapped fiscal years, and internal miscommunication led to its initial exclusion from the SEFA submitted for audit. Management will enhance the SEFA preparation process by revising its procedures and adding additional controls to monitor for completeness of the data. This will include comparisons to the prior year programs, enhancing the Company’s grant tracking process, and review of the SEFA with key stakeholders. Upon identification of the omission, management reviewed the grant activity and has taken corrective action to ensure proper inclusion in future SEFA reports.
FINDING 2023-003 Subject: Water and Waste Disposal Systems for Rural Communities - Reporting Federal Agency: Department of Agriculture Federal Program: Water and Waste Disposal Systems for Rural Communities Assistance Listings Number: 10.760 Federal Award Number and Year (or Other Identifying Number): 15-067-192756261 Compliance Requirement: Reporting Audit Finding: Material Weakness Condition and Context The District had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. The District was required to submit annual data reports to the United States Department of Agriculture. Data to be submitted included, but was not limited to, current period assets, current and prior year budgets, and operating income. Both of the reports submitted by the District were supported by the District's records. However, there was no evidence of an internal control, such as a review or approval process, over the data submitted. The lack of internal controls was pervasive in the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause Management of the District stated that a lack of staff left no knowledgeable individual to review the reports. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, reports for the Water and Waste Disposal Systems for Rural Communities program were prepared, entered, and submitted by one individual with no internal controls to prevent or detect errors. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the District establish a proper system of internal controls and develop policies and procedures to ensure that all reports are properly reviewed before submission. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2023-002 Compliance and Internal Controls over Subrecipient Fiscal Monitoring (Significant Deficiency) (Repeat) U.S. Department of Health and Human Services 93.917 – HIV Care Formula Grants Passed through Texas Department of State Health Services Award Periods: April 1, 2022 to March 31, 2024 Contract No. HHS001022300001 Texas Department of State Health Services HIV Care Formula Grants Award Periods: April 1, 2022 to March 31, 2024 Contract No. HHS001022300001 Texas Department of State Health Services State HIV Service Grants Award Periods: April 1, 2022 to August 31, 2024 Contract No. HHS001022300002 Criteria: Pass-through entities are required to monitor subrecipients in accordance with 2 CFR Section 200.332. Further, under 2 CFR Section 200.303a, non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statutes, regulations, and the terms and conditions of the award. Condition: For the fiscal year ended December 31, 2023, The Resource Group did not timely perform financial monitoring of its subrecipients. Cause: Initially subrecipient monitoring was suspended due to COVID-19 in 2020 and reinstated late 2021. The Resource Group restarted their monitoring of subrecipients, however the monitoring was done by two individuals, one for programming and the other for financial monitoring. Monitoring of programming was completed timely, while the financial monitoring was not. Further, the Finance Director, who was responsible for the financial monitoring, resigned in 2023 and the successor Finance Director was hired in August 2023. After completing training to perform financial monitoring, the Finance Director completed financial monitoring during 2024. Effect: As a result of not completing all financial monitoring and the turnover in Finance Director, The Resource Group is not in compliance with grant requirements. Questioned Costs: None Noted Recommendation: The Resource Group should follow its policies to perform fiscal monitoring on its subrecipients in accordance with 2 CFR Section 200.332. Views of Responsible Officials: See corrective action plan.
Internal Control over Schedule of Expenditures of Federal Awards Year Ended December 31, 2023 Segregation of Duties Condition and criteria: During our audit of the Borough’s Schedule of Expenditures of Federal Awards, we noted that the Borough does not have adequate segregation of duties in place. Specifically, the same individual is responsible for initiating and recording journal entries and disbursements and reconciling the bank accounts. In accordance with 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. Cause and Effect: The Borough is a small entity with limited administrative and accounting staff, which makes it difficult to achieve a complete segregation of duties. Due to resource constraints, individual staff members are assigned multiple roles that overlap key financial processes. Without proper segregation of duties, there is an increased risk that errors or irregularities, including potential misappropriation of assets or fraud, could occur and remain undetected. This condition could lead to noncompliance with applicable federal requirements and inaccuracies in financial reporting. Auditor’s Recommendations: We recommend that Eldred Borough assess the current structure and implement compensating controls where full segregation of duties is not feasible due to staffing limitations. These may include enhanced supervisory review, periodic oversight by the board or executive leadership, documentation of independent reviews, and rotation of duties when possible. Borough’s Response: Eldred Borough has board oversight and will continue to do so. The Borough employees do cover duties of the other employee when necessary and will continue to do so. Bank Reconciliations will be signed by Council. Pay Requisitions are signed by Council and will continue to do so.
Internal Control over Schedule of Expenditures of Federal Awards Year Ended December 31, 2023 Segregation of Duties Condition and criteria: During our audit of the Borough’s Schedule of Expenditures of Federal Awards, we noted that the Borough does not have adequate segregation of duties in place. Specifically, the same individual is responsible for initiating and recording journal entries and disbursements and reconciling the bank accounts. In accordance with 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. Cause and Effect: The Borough is a small entity with limited administrative and accounting staff, which makes it difficult to achieve a complete segregation of duties. Due to resource constraints, individual staff members are assigned multiple roles that overlap key financial processes. Without proper segregation of duties, there is an increased risk that errors or irregularities, including potential misappropriation of assets or fraud, could occur and remain undetected. This condition could lead to noncompliance with applicable federal requirements and inaccuracies in financial reporting. Auditor’s Recommendations: We recommend that Eldred Borough assess the current structure and implement compensating controls where full segregation of duties is not feasible due to staffing limitations. These may include enhanced supervisory review, periodic oversight by the board or executive leadership, documentation of independent reviews, and rotation of duties when possible. Borough’s Response: Eldred Borough has board oversight and will continue to do so. The Borough employees do cover duties of the other employee when necessary and will continue to do so. Bank Reconciliations will be signed by Council. Pay Requisitions are signed by Council and will continue to do so.
Internal Control over Schedule of Expenditures of Federal Awards Year Ended December 31, 2023 Segregation of Duties Condition and criteria: During our audit of the Borough’s Schedule of Expenditures of Federal Awards, we noted that the Borough does not have adequate segregation of duties in place. Specifically, the same individual is responsible for initiating and recording journal entries and disbursements and reconciling the bank accounts. In accordance with 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. Cause and Effect: The Borough is a small entity with limited administrative and accounting staff, which makes it difficult to achieve a complete segregation of duties. Due to resource constraints, individual staff members are assigned multiple roles that overlap key financial processes. Without proper segregation of duties, there is an increased risk that errors or irregularities, including potential misappropriation of assets or fraud, could occur and remain undetected. This condition could lead to noncompliance with applicable federal requirements and inaccuracies in financial reporting. Auditor’s Recommendations: We recommend that Eldred Borough assess the current structure and implement compensating controls where full segregation of duties is not feasible due to staffing limitations. These may include enhanced supervisory review, periodic oversight by the board or executive leadership, documentation of independent reviews, and rotation of duties when possible. Borough’s Response: Eldred Borough has board oversight and will continue to do so. The Borough employees do cover duties of the other employee when necessary and will continue to do so. Bank Reconciliations will be signed by Council. Pay Requisitions are signed by Council and will continue to do so.
Internal Control over Schedule of Expenditures of Federal Awards Year Ended December 31, 2023 Segregation of Duties Condition and criteria: During our audit of the Borough’s Schedule of Expenditures of Federal Awards, we noted that the Borough does not have adequate segregation of duties in place. Specifically, the same individual is responsible for initiating and recording journal entries and disbursements and reconciling the bank accounts. In accordance with 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. Cause and Effect: The Borough is a small entity with limited administrative and accounting staff, which makes it difficult to achieve a complete segregation of duties. Due to resource constraints, individual staff members are assigned multiple roles that overlap key financial processes. Without proper segregation of duties, there is an increased risk that errors or irregularities, including potential misappropriation of assets or fraud, could occur and remain undetected. This condition could lead to noncompliance with applicable federal requirements and inaccuracies in financial reporting. Auditor’s Recommendations: We recommend that Eldred Borough assess the current structure and implement compensating controls where full segregation of duties is not feasible due to staffing limitations. These may include enhanced supervisory review, periodic oversight by the board or executive leadership, documentation of independent reviews, and rotation of duties when possible. Borough’s Response: Eldred Borough has board oversight and will continue to do so. The Borough employees do cover duties of the other employee when necessary and will continue to do so. Bank Reconciliations will be signed by Council. Pay Requisitions are signed by Council and will continue to do so.
Medical Assistance Eligibility Condition: The Minnesota Department of Human Services (DHS) maintains the computer systems, MAXIS and METS, which are used by Renville County to support the eligibility determination process. In the case files reviewed for eligibility, there were several cases noted in which the Adjusted Gross Income (AGI) was not calculated correctly, and there was no supporting documentation provided for the differences. Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Cause: Program personnel entering case data into MAXIS or clearing case data flagged by METS did not properly calculate or retain support for the AGI entered into the system. Effect: As a result, the Board is out compliance with the statute. Recommendation: We recommend Renville County define and implement procedures for calculating and supporting AGI used for eligibility determinations. Management Response: The County acknowledges the finding and has implemented procedures to ensure AGI is calculated correctly.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-002 Internal Controls over Period of Performance and Procurement, Suspension and Debarment (Material Weakness) U.S. Department of Housing and Urban Development 14.267 Continuum of Care Program 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, under 2 CFR Section 200.403 (g) and (h), the Organization’s expenditures must be adequately documented and incurred during the approved budget period, respectively. Furthermore, under 2 CFR Section 200.320, the Organization must have and use documented procurement procedures for acquisition of property and services under a federal award or a sub-award. Condition: AIH’s control process relied on the review of Director of Housing and Supportive Services for maintaining compliance with the period of performance and procurement, suspension and debarment requirements under the Compliance Supplement. However, that control appears to not have worked as intended during the year because of identified fraud relating to questionable procurements for certain services obtained throughout the year that were subject to approval and review by the Director of Housing and Supporting Services. Note that the fraud was identified by management and has already been reported to the grantor. In addition, an accrual for the fraudulent reimbursements was recorded at year end. Cause: The Director of Housing and Supportive Services did not adequately review credit card and check transactions to ensure transactions were for legitimate business purposes and within the period of performance. Effect: Allowable cost was not required to be tested under the compliance supplement. However, AIH has already identified and accrued for remittances to be made to the grantor for fraudulent reimbursements. For testing of period of performance and procurement, suspension and debarment compliance requirements, sample sizes had to be increased to gain comfort over the requirements to be tested. No compliance issues were identified during our testing. Questioned Costs: $33,439 Perspective: Identified fraud by management was specific to one former program coordinator and one former case manager. Repeat Finding: No Recommendation: Director of Housing and Supportive Services and any other approvers should be retrained to identify allowable and reasonable costs under the grant before approving such requests. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-003 Internal Controls and Compliance over Allowable Costs (Significant Deficiency) U.S. Department of Health and Human Services 93.939 HIV Prevention Activities - Non-Governmental Organization Based 2022-2023 and 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, grantees are required to have a detailed breakout of these costs along with any supporting documents for those expenses for auditing and oversight. Title 2 CFR 200.302 requires the financial management system of each non-Federal entity provide records that identify adequately the source and application of funds for federally-funded activities. Condition: We noted instances of the allocation rates being used to calculate amount of payroll costs to charge to grants did not agree to the hours incurred per approved timesheets. SECTION III – FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Cause: The personnel costs charged to the grant were not reconciled to timesheets correctly by the accounting personnel. Effect: AIH requested in error reimbursement for unallowable payroll costs. Questioned Costs: $42 Perspective: Allocation errors were noted for 2 employees in 3 payroll periods tested. Repeat Finding: No Auditor’s Recommendation: Review process should be reevaluated and employees retrained to ensure that only actual hours worked from timesheets are charged to grant. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
2023-003 Internal Controls and Compliance over Allowable Costs (Significant Deficiency) U.S. Department of Health and Human Services 93.939 HIV Prevention Activities - Non-Governmental Organization Based 2022-2023 and 2023-2024 Funding Criteria: Under 2 CFR Section 200.303(a), non‐federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statues, regulations, and the terms and conditions of the award. Additionally, grantees are required to have a detailed breakout of these costs along with any supporting documents for those expenses for auditing and oversight. Title 2 CFR 200.302 requires the financial management system of each non-Federal entity provide records that identify adequately the source and application of funds for federally-funded activities. Condition: We noted instances of the allocation rates being used to calculate amount of payroll costs to charge to grants did not agree to the hours incurred per approved timesheets. SECTION III – FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (Continued) Cause: The personnel costs charged to the grant were not reconciled to timesheets correctly by the accounting personnel. Effect: AIH requested in error reimbursement for unallowable payroll costs. Questioned Costs: $42 Perspective: Allocation errors were noted for 2 employees in 3 payroll periods tested. Repeat Finding: No Auditor’s Recommendation: Review process should be reevaluated and employees retrained to ensure that only actual hours worked from timesheets are charged to grant. Views of Responsible Officials: We concur with the recommendation, please see Corrective Action Plan.
Material Weakness in Cash Management Controls Federal Agency and Pass-through Entity: U.S. Environmental Protection Agency – Georgia Environmental Finance Authority Program Title/Cluster: Clean Water State Revolving Fund Cluster (CWSRF) Criteria: In accordance with 2 CFR §200.305(b), when advance payments are made, the non-federal entity must maintain written procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury (or pass-through entity) and disbursement. Effective internal control over compliance with the cash management requirement includes documented procedures to ensure federal funds are drawn down only when needed and promptly disbursed. Per 2 CFR §200.303, the non-federal entity must establish and maintain effective internal controls over federal awards that provide 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: During our testing of compliance with cash management requirements for the CWSRF program, we inquired about the City’s procedures to minimize the time elapsed between draw requests, deposit of funds, and disbursement to contractors. We noted that the City did not have formal or documented internal controls in place specifically related to this process. No control activities were identified to monitor or ensure timely disbursement following drawdowns. Effect: The absence of identifiable internal controls over cash management increases the risk of noncompliance with federal requirements, including the potential for drawing federal funds in advance of immediate cash needs. While our audit testing did not identify any instances of noncompliance (contractor payments were made within a reasonable timeframe) this control deficiency represents a material weakness in internal control over compliance. Questioned Costs: None reported. Recommendation: We recommend that the City develop and implement formal, documented procedures and internal controls to ensure that federal funds are drawn only when needed and disbursed in a timely manner in accordance with federal cash management requirements. This should include documented monitoring of the timing of drawdowns and corresponding disbursements. Status: New finding in the current year.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 228MN300S6031 – 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55210010 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Agencies are required to automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP (7 CFR sections 272.10 and 277.18). This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of case disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period (7 CFR sections 272.10(b)(1)(iii) and 273.10(f) and (g)); and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted: • There was no documentation or improper documentation related to the verification of citizenship for 6 of the 60 casefiles tested. • There was no verification of income on 3 of the 60 casefiles tested. • Income was input into Maxis incorrectly on 2 of the 60 casefiles tested. • There was not signature on application on 1 of the 60 casefiles tested. Questioned costs: None Context: 11 of the 60 casefiles tested had the above noted issues. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2022-004 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Agriculture Federal Program Name: Supplemental Nutrition Assistance Program Cluster Assistance Listing Number: 10.561 Federal Award Identification Number and Year: 228MN300S6031 – 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The County must follow Uniform Guidance Subsection 200.320 Methods of Procurement for all applicable procurements over the County’s micro-purchase threshold. For purchases over the County's micro-purchase threshold of $10,000 but not exceeding the simplified acquisition threshold of $250,000, the County should follow small purchase procedures. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the County. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing, it was noted that for 2 contracts out of 4 tested the County was unable to provide documentation showing they contract awards followed the open competition requirement. Questioned costs: None Context: 2 out of the 4 contracts tested had no documentation of open competition. Cause: The county purchasing likely followed county purchase policies for non-federal expenditures. Effect: It would be possible that the County could end up spending more federal dollars than necessary for a product or service, if they are not going through the steps to ensure they are utilizing the best vendor for the county and documenting this process each year. Repeat finding: No Recommendation: We recommend the County follow their federal purchasing policy in all of their federal programs and retain documentation of that process occurring. As necessary, the County may need to add internal controls that are program specific to ensure this properly occurs. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 2 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 2 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: Yes – 2022-0007 Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Questioned costs: None Context: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Cause: The County did not adequately review the Cost Allocation Plan which was prepared by a third party vendor. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Treasury Federal Program Name: State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Award Identification Number and Year: SLFRP3412 - 2023 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Related to subrecipient monitoring requirements of State and Local Fiscal Recovery Funds, there should be a documented control in place to ensure all subrecipients of federal grants are in compliance with Title 2 U.S. Code of Federal Regulations § 200.331 - 200.333. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During our testing it was noted that, for 1 of 1 subrecipients tested, the county was not able to provide any documentation of the review performed to ensure they are meeting federal requirements surrounding subrecipient monitoring. Questioned costs: None Context: 1 of 1 subrecipients selected for testing were missing documentation. Cause: The County has a monitoring checklist they complete, but did not have adequate documentation that it was completed. Effect: It is possible that the County subrecipient could be ineligible to receive funding if an error is made in compiling the information since there is no control in place in some instances to ensure that errors are not being made prior to payment. Repeat finding: No Recommendation: We recommend that the County establish clear policies and procedures for formal review and approval of subrecipient monitoring checklists. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 9 of 60 casefiles selected for testing had citizenship selected as yes, but had no support retained to prove that citizenship verification had occurred. • 3 of 60 casefiles selected for testing had citizenship verified by driver’s license which is not a valid method of determining citizenship. • 8 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 12 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 32 instances that were part of 30 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2022-003 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Temporary Assistance for Needy Families Assistance Listing Number: 93.558 Federal Award Identification Number and Year: 2201MNTANF – 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Number: H55214077 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The State provides the specifics on the definition of need, which the State and County uses in determining eligibility. Casefiles and related computer systems must be accurately maintained to support eligibility determinations. Condition: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted that not all documentation was available to support participant eligibility. In other circumstances, information was either input incorrectly or not properly updated in MAXIS. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. The following instances were noted in sample of 60 cases tested: • 9 of 60 casefiles selected for testing had citizenship selected as yes, but had no support retained to prove that citizenship verification had occurred. • 3 of 60 casefiles selected for testing had citizenship verified by driver’s license which is not a valid method of determining citizenship. • 8 of 60 casefiles selected for testing did not have verified worker approval of annual eligibility certification documentation on file. • 12 of 60 casefiles selected for testing had various inconsistencies between what was shown on MAXIS for income or assets and what was provided as testing support in the casefile to State’s eligibility requirements for TANF as provided in the State plan, including being "needy." Questioned costs: None Context: The context of the variance instances noted in the 60 case files tested is summarized above. Note that, of the 60 case files tested, there were a total of 32 instances that were part of 30 casefiles. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: Yes – 2022-003 Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 2 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 2 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: Yes – 2022-0007 Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 2 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 2 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: Yes – 2022-0007 Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Questioned costs: None Context: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Cause: The County did not adequately review the Cost Allocation Plan which was prepared by a third party vendor. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Questioned costs: None Context: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Cause: The County did not adequately review the Cost Allocation Plan which was prepared by a third party vendor. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Medical Assistance Assistance Listing Numbers: 93.778 Federal Award Identification Numbers and Years: 2305MNMAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Minnesota Department of Human Services (DHS) requires a listing of employees working on social services programs to be submitted quarterly, known as a random moment study listing (RMS listing). DHS then determines the amount applicable to the applicable income maintenance programs through random moment studies. Each quarter the County’s coordinator reviews their RMS listing to ensure the employees listed are accurate for the people working and being coded in the general ledger. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 7 individuals were included on the 1st quarter Social Services RMS listing sent to the State that were not supposed to be included in the listings, 7 individuals were noted to have the same issue on the 4th quarter Social Services RMS listing. Questioned costs: None Context: In our testing of 2 of the 4 quarterly RMS listings, 7 individuals were included on the 1st quarter RMS listing sent to the State that were not supposed to be included in the listings, 7 individuals were noted to have the same issue on the 4th quarter RMS listing. There were 302 County staff listed in the 1st quarter’s RMS listing and 306 County staff listed in the 4th quarter’s RMS listing. Cause: The County's RMS controls and procedures were not robust enough to note that the RMS listings should have excluded various individuals. Increased turnover and growth of the programs also created an increase in the number changes that were needed to be made to the listings. Effect: Lack of proper controls could affect allocation of fundings due to the staff not being in MAXIS or actually assigned to social services case files to properly respond to the random moment requests that are sent by the State as part of the random moment study. Repeat Finding: No Recommendation: We recommend that the County review its procedures and control to ensure all RMS listings sent to the State properly exclude those necessary individuals no longer working in the programs. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Medical Assistance Assistance Listing Numbers: 93.778 Federal Award Identification Numbers and Years: 2305MN5MAP – 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Agencies are required to automate their MA operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning MA (7 CFR sections 272.10 and 277.18). This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of case disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period (7 CFR sections 272.10(b)(1)(iii) and 273.10(f) and (g)); and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: One of the casefiles was approved utilizing an unsigned application for July where it was noted that the application was signed. There was a signed application in September for this individual, however the MAXIS system showed that the application was signed and dated in July. The second issue noted was for eligibility for adoption assistance that didn’t have any casefile documentation that it was reviewed during the year for eligibility. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Questioned costs: None Context: The Minnesota Department of Human Services (DHS) maintains the computer system, MAXIS, which is used by the County to support the eligibility determination process. While periodic supervisory case reviews are performed to monitor compliance with grant requirements for eligibility, when performing our case file review for eligibility, we noted issues related to 2 of the 40 Maxis Individuals Tested. Cause: The County has had significant turnover and new staff over the past three years as well as increases in caseloads. There was also changing guidance as waivers from the pandemic expired. All of this provided more opportunities for errors to occur. Effect: Improper input or updating of information in MAXIS and lack of verification or follow-up of eligibility determining factors increase the risk that a program participant will receive benefits when they are not eligible. Repeat finding: No Recommendation: We recommend the County implement process and procedures to provide reasonable assurance that all necessary documentation to support eligibility determination exists and is properly input or updated in MAXIS and issues are followed up in a timely manner. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: 2 of 40 disbursements selected for testing lacked formal documentation of review and approval. Questioned costs: None Context: Lack of formal documentation of review and approval was noted with 2 of 40 disbursements selected for testing. Cause: At the time of testing, due to the cost allocation plan using a 2-year lag and then the audit occurring after year end, the item selected for testing was from about 3 years ago, and the County did not retain the supporting documentation of review and approval. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: Yes – 2022-0007 Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Medical Assistance Assistance Listing Numbers: 93.778 Federal Award Identification Numbers and Years: 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55215048 Award Period: 2023 Type of Finding: Material Weakness in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The County and the Minnesota Department of Human Services (DHS) have a contract surrounding the federal funds. This contract has several obligations and reporting requirements the County must follow. Condition: • The County was unable to provide documented formal review or approval of the LCTS Annual Spending Report. • The County was unable to provide documented formal review or approval of the quarterly cost reports. • The County was unable to provide a documented formal review process to ensure that LCTS fiscal site contacts were trained on completing cost schedules. Questioned costs: None Context: The County did not provide the documentation of the review over these requirements. Cause: The County did not maintain a record of their review process Effect: There is no way to verify the review process was completed and completed timely. Repeat finding: No Recommendation: We recommend that the County review its policies and controls to ensure there is a formally documented control to ensure all reports are reviewed and the documentation of the review is retained. Views of responsible officials: There is no disagreement with the finding.
Federal Agency: U.S. Department of Agriculture & U.S. Department of Health and Human Services Federal Program Name: Supplemental Nutrition Assistance Program Cluster, Temporary Assistance for Needy Families, & Medical Assistance Assistance Listing Numbers: 10.561, 93.558, and 93.778 Federal Award Identification Numbers and Years: 228MN300S6031 – 2023, 2201MNTANF – 2023, 2305MN5MAP - 2023 Passed Through Entity: Minnesota Department of Human Services Pass Through Numbers: H55230010, H55214077, H55215048 Award Period: 2023 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Costs included in the County’s Cost Allocation Plan should follow the principles to establish allowability or unallowability of certain items of cost (2 CFR sections 200.420 through 200.476), including retention of supporting documentation and documentation of the related controls. Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Questioned costs: None Context: Building depreciation on the Cost Allocation Plan was overstated and did not agree to the actual building depreciation. Cause: The County did not adequately review the Cost Allocation Plan which was prepared by a third party vendor. Effect: Lack of proper controls result in error or unintended expenditures that could go undetected or not detected and corrected in a timely manner. Repeat Finding: No Recommendation: We recommend that the County retain documentation of review and approval of all expenditures. Views of responsible officials: There is no disagreement with the audit finding.
Department of Homeland Security, State of Iowa Department of Homeland Security and Emergency Management, 97.036, 4642DRIAP00000501 Disaster Grants – Public Assistance Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Period of Performance Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Materials and transportation costs were claimed for reimbursement with no documented formal review and approval. Cause: The Cooperative did not have any formally documented review and approval over the material and transportation costs claimed for reimbursement under the program. Effect: Without a formal documentation of review of expenses, demonstrating the expenditures comply with federal regulations is difficult. Questioned Costs: No questioned costs over $25,000. Context/Sampling: A nonstatistical sample of 60 transactions were selected for testing, which accounted for $963,000 of $1,310,794 of federal program expenditures. Repeat Finding form Prior Year: No Recommendation: We recommend the Cooperative review the process for documenting the review and approval over material and transportation costs. Views of Responsible Officials: Management agrees with the finding.
U.S. Department of Housing and Urban Development Federal Financial Assistance Listing #14.134 Mortgage Insurance Rental Housing Project Number: 091-11022 HUD Regulatory Agreement Dated July 1, 2016 Procurement, Suspension, and Debarment Significant Deficiency in Internal Control over Compliance Criteria: 2 CRF 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The non-Federal entity’s documented procurement procedures must conform to the procurement standards identified in 2 CFR 200.317 through 200.327 which also requires documentation to be retained to detail the history of procurements. In addition, as outlined in 2 CFR 180, recipients must not utilize any vendor which is suspended or debarred or is otherwise excluded from the central contactor registry. Condition: There was one vendor with expenditures in excess of $25,000 and the Project did not verify the vendor against the central contractor registry prior to entering into the transaction or on a periodic basis to ensure that the vendor was not suspended or debarred. Prior to adoption of a procurement policy, management entered into a transaction over the micropurchase threshold with a vendor and documentation was unable to be provided to support procurement compliance for the vendor. Cause: The Project adopted a written procurement policy which conforms to Uniform Guidance during May 2023 and therefore, the Project did not have a policy in place to follow from January through May. Management overlooked the requirement to verify the vendor against the central contractor registry for a vendor. Effect: Inadequate controls over this area of compliance result in a reasonable possibility that the Project would not have the required documentation in place and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: $23,335 Context/Sampling: A nonstatistical sample of 4 of 8 transactions applicable to procurement requirements were selected for testing, which accounted for $95,590 of $199,971 of transactions. In addition, there was one vendor in which suspension and debarment requirements were applicable and the vendor was tested. Repeat Finding from Prior Year: Yes Recommendation: Management implemented formal procedures over procurement during May 2023 and we recommend management continue following those formal procedures. In addition, we recommend management implement formal procedures over suspension and debarment and retain sufficient documentation to support the process was followed. Views of Responsible Officials: Management agrees with the finding and recommendation.
2023-001 Lack of Review Department of Housing and Urban Development AL #14.181 - Supportive Housing for Persons with Disabilities (Section 811) Material Weakness Category of Finding – Eligibility Condition – For most of 2023, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Criteria – 2 CFR section 200.303 requires that organizations who receive federal awards establish and maintain effective internal controls over the federal award that provides reasonable assurance that the organization is managing the federal award in compliance with the federal statues, regulations, and terms and conditions of the award. It also states that controls "should" be in compliance with guidance in "standards for Internal Control in the Federal Government" issued by the Comptroller General of the United State (the Green Book) or the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activates over eligibility include the following (excerpt from the Green Book): • Proper design of control activities to ensure program compliance should include a process for management to identify and put into effect actions need to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. • Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. • Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause – Due to the limited number of staff employed by the Organization in the Housing department there is a lack of adequate segregation of duties in regards to the review of eligibility and rent calculations. This service was contracted out during 2023, but the contractor also only involved a limited number of staff in the process for there was still a lack of adequate segregation of duties in regards to the review. Effect – By not having proper implementation of controls to ensure that recertifications and rent calculations are reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Questioned Costs – None. Recommendation – We recommend controls be put in place to ensure the eligibility determinations and rent calculations (initial or recertifications) be reviewed and/or approved by someone other than the individual making the determination. Management’s Response and Corrective Action – Management agrees with this finding. Beginning in September 2023, management has changed contractors. The contract with the new contractor includes a process by which the contractor acts one part of the preparation and review process and that staff members at Accord act of the other half, so that there is always a review occurring by on individual other than the preparer. Responsible party for corrective action: Robert Pickering, Chief Financial Officer Repeat Finding: This is a repeat finding. A similar finding was reported as 2022-001
2023-001 Lack of Review Department of Housing and Urban Development AL #14.181 - Supportive Housing for Persons with Disabilities (Section 811) Material Weakness Category of Finding – Eligibility Condition – For most of 2023, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Criteria – 2 CFR section 200.303 requires that organizations who receive federal awards establish and maintain effective internal controls over the federal award that provides reasonable assurance that the organization is managing the federal award in compliance with the federal statues, regulations, and terms and conditions of the award. It also states that controls "should" be in compliance with guidance in "standards for Internal Control in the Federal Government" issued by the Comptroller General of the United State (the Green Book) or the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activates over eligibility include the following (excerpt from the Green Book): • Proper design of control activities to ensure program compliance should include a process for management to identify and put into effect actions need to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. • Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. • Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause – Due to the limited number of staff employed by the Organization in the Housing department there is a lack of adequate segregation of duties in regards to the review of eligibility and rent calculations. This service was contracted out during 2023, but the contractor also only involved a limited number of staff in the process for there was still a lack of adequate segregation of duties in regards to the review. Effect – By not having proper implementation of controls to ensure that recertifications and rent calculations are reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Questioned Costs – None. Recommendation – We recommend controls be put in place to ensure the eligibility determinations and rent calculations (initial or recertifications) be reviewed and/or approved by someone other than the individual making the determination. Management’s Response and Corrective Action – Management agrees with this finding. Beginning in September 2023, management has changed contractors. The contract with the new contractor includes a process by which the contractor acts one part of the preparation and review process and that staff members at Accord act of the other half, so that there is always a review occurring by on individual other than the preparer. Responsible party for corrective action: Robert Pickering, Chief Financial Officer Repeat Finding: This is a repeat finding. A similar finding was reported as 2022-001
2 CFR §2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR §200.303(a) which states that 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. 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). Furthermore, 2 CFR §200.430(i)(1)(i) states "charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal controls which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The “City of Columbus Fiscal Policies and Procedures for the Administration of HUD Grants Manual” Part II Section C – Standards for Documentation of Personal Services provides the following: All grant funded staff (both city staff and subrecipient staff) will utilize personal activity reports (timesheets). All timesheets will reflect total hours worked, identify the federal grant hours worked, and be signed by either the employee or the supervisor. Furthermore, the City of Columbus Department of Development has established a procedure of timesheet review which requires supervisors review employee timesheets within one week of the pay period end date. This review is evidenced by an electronic signature on the employee-completed timesheet. While the City does have an internal control policy in place in accordance with 2 CFR 430(i)(1)(i), supervisors were not always adhering to the policy which resulted in a deficiency in the application of the control process. Payroll control testing over AL #14.239 Home Investment Partnership Program, it was noted 13 out of the 19 selected worklogs (68%) were not signed by the supervisor within the one-week requirement as required by City policy. Supervisory sign offs occurred between 7 and 102 working days (not including weekends) following the end of the pay period. Failure to follow the established internal control policy and ensuring all time sheets are appropriately approved by a knowledgeable supervisor, within one week of the pay period end date, could result in unallowable costs being allocated to a federal program and could ultimately result in noncompliance and/or a questioned cost. The City should review established policies and procedures with supervisory personnel and evaluate if additional control procedures should be in place to ensure all timesheets are appropriately reviewed timely prior to allocation to a federal program.
Condition: For 3 out of 25 selected transactions, management did not properly update the Full Time Equivalent (FTE) allocation tables, resulting in an overcharge of personnel costs to its Federal programs. Criteria: In accordance with 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. In accordance with 2 CFR 200.430: (i) Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities; (iv) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; and (vi) 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. Cause: Maryland Legal Aid did not have controls in place to detect errors in the FTE allocation tables that were used to allocate personnel costs to its Federal programs. Effect: Unallowed payroll costs could be charged to Federal grants. Questioned Costs: Unknown. Recommendation: We recommend Maryland Legal Aid perform a detailed review of the FTE allocations used to allocate personnel costs to its Federal programs. Auditee Response and Corrective Action Plan: Refer to management’s corrective action plan.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Assistance Listing Numbers: 21.027 Name of Federal Program or Cluster: Coronavirus State and Local Fiscal Recovery Funds–COVID-19 Name of Federal Agency: Department of Treasury Name of Pass-through Entity: Wisconsin Department of Justice, Wisconsin Department of Children and Families, and Dane County Department of Human Services Award Period: January 1, 2023 through December 31, 2023; October 1, 2022 through September 30, 2023; and October 1, 2023 through September 30, 2024. Assistance Listing Numbers: 93.671 Name of Federal Program or Cluster: Family Violence Prevention and Services/Domestic Violence Shelter and Supportive Services Name of State Program: DV Basic Services and DV Children’s Programming Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entity: Wisconsin Department of Children and Families Award Period: January 1, 2023 through December 31, 2023 Criteria: According to 2 CFR, Part 200.303 of the Office of Management and Budget’s Uniform Grant Guidance, a non-federal entity must establish and maintain effective internal controls to ensure compliance with federal statues, regulations, and the terms and conditions of federal awards. Condition: Domestic Abuse Intervention Services, Inc.'s internal controls over review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting were not properly documented. Cause: Sufficient training was not provided to individuals responsible for the documentation of internal controls over compliance requirements. Effect or Potential Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Recommendation: We recommend formally documenting the controls over each area by providing additional training on documentation and forms to provide evidence of review. Views of Responsible Officials: Domestic Abuse Intervention Services, Inc. agrees with the finding and will train individuals and document the review of cost allocation journal entries, allowable costs and activities, period of performance, cash management, matching, and reporting.
Finding 2023-001: Subrecipient Monitoring Identification of federal program: Program Title: Community Economic Adjustment Assistance for Compatible Use and Joint Land Use Studies Assistance Listing Number: 12.610 Award Identification: W9124J2120002 Federal Agency: U.S. Department of Defense, Office of Local Defense Community Cooperation Criteria or Specific Requirement: Title 2 CFR § 200.303(a) requires pass-through entities to 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. All pass-through entities are required to have subrecipient monitoring policies and procedures in place, which conform to the requirements of Title 2 CFR § 200.332 to identify subawards, evaluate risk of noncompliance, and perform monitoring procedures based upon identified risks. Condition: In testing compliance over subrecipient monitoring, we noted the Fund does not have a subrecipient monitoring policy in place that fully conforms with requirements of Title 2 CFR § 200.332. Cause: Historically the Fund has had few subawards and therefore has not developed full written subrecipient monitoring policies and procedures. Effect: The Fund should implement policies and procedures for monitoring subrecipients in accordance with Title 2 CFR § 200.332. Questioned Costs: None Context: While management’s existing process includes certain elements of subrecipient monitoring, a formal adopted policy is not in place that that fully conforms with requirements of Title 2 CFR § 200.332. Repeat finding: No Recommendation: Implement policies and procedures for monitoring subrecipients, including adequate documentation that conforms to the requirements of Title 2 CFR § 200.332. Views of responsible individuals: Management concurs with and will implement the recommendation. See corrective action plan.