Criteria: In accordance with 2 CFR 200.328 and 2 CFR 200.329, the College is required to prepare and publicly post quarterly reports related to the student aid and institutional portions of HEERF expenditures. Condition: During our audit, we selected one of the four quarterly reports to test the accuracy of the reporting. Our testing indicated certain amounts on the quarterly report that did not agree to the expenditures for the quarter. Questioned Costs: None Effect: The College was not in compliance with HEERF reporting requirements. Cause: Certain HEERF I expenditures were improperly excluded from the report and some misunderstanding of requirements of certain items in the report. Recommendation: We recommend reconciliation of quarterly reports to related grant documentation and review of the reports by an appropriate team member to ensure accuracy. Views of responsible officials and planned corrective action: The College agrees with this finding and will adhere to the corrective action plan on page 34 in this audit report.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
Condition: Rainbow Health Minnesota did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a non-federal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Rainbow Health Minnesota did not submit its year ended December 31, 2020 audit reporting package to the Federal Audit Clearinghouse until November 4, 2021, its year ended December 31, 2021 audit reporting package until February 10, 2023 and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Rainbow Health Minnesota continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have implemented the following internal control policies and procedures concerning the timeliness of financial activities: Rainbow Health Minnesota is reimplementing monthly board meetings that will include a financial review of income and expense reports and balance sheets. The lateness for the 2022 audit was partially due to staff turnover of the CFO and the subsequent review by the new Finance Director. Responsibility for administering this process resides with the Finance Director.
U.S. Department of the Treasury Passed through State of Arizona, Maricopa County (Maricopa County), Federal Financial Assistance Listing #21.027, PE386182260A4 2022, Coronavirus State and Local Fiscal Recovery Funds Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements, to assure performance expectations are being achieved, and to report these items in accordance with program requirements. The Foundation is required to submit quarterly performance reports. Reports should be prepared complete, accurate, and in accordance with the required basis for reporting, submitted timely with the terms of the grant award, and reviewed by an individual prior to submission to ensure accuracy. Condition: Although the reports were reviewed in accordance with internal controls, the review process did not properly identify on two out of the two reports tested that they were submitted with inaccurate information. Supporting documentation for the reports submitted used budgeted expensed amounts, not actual, and the budgeted expensed amounts for the period did not agree to amounts reported. Cause: The Organization has limited staffing and did not have proper controls in place relating to review of information included in reports to ensure completeness and accuracy. Effect: Inaccurate information may be provided to the grantor regarding performance of the Foundation. Questioned Costs: None reported. Context: A nonstatistical sample of 2 out of 4 reports submitted were selected for testing. Repeat Finding from Prior Years: No Recommendation: We recommend the Foundation’s management routinely review and consider modifications that would strengthen the internal controls surrounding the reporting process, recordkeeping, and the management thereof. Specifically, management should ensure that financial records are such to provide actual amounts of grant expenditures incurred for reporting purposes at required reporting dates, and that the review control ensures that reports provided to grantors agree with internal financial records. Views of Responsible Officials: Management agrees with the finding.
2 CFR 1000.10 provides that, except for the deviations set forth elsewhere in this Part, the Department of Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards set forth at 2 CFR Part 200. 2 CFR 200.302(b) states, in part, that the financial management system of each non-Federal entity must provide for the accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. The City did not have proper internal controls in place to ensure the accurate submission of the Project and Expenditure Reports. During testing of Project and Expenditure Reports for the Coronavirus State and Local Fiscal Recovery Funds (AL #21.027), we noted that: ? The City did not properly report cumulative obligations on the report required by July 31, 2022. The City over-reported cumulative obligations due to including a funding project more than once for $880,000 to the Justice Center Design project; and ? The City did not properly report cumulative obligations nor current period expenditures on the report required by October 31, 2022. The City over-reported cumulative obligations by $880,000 due to including a funding project more than once to the Justice Center Design project. The City also over-reported current period expenditures due to including the current period expenditures of $175,741 for a funding project more than once to Rehiring Staff project. Failure to have the proper controls in place to ensure the timely and accurate submission of the Project and Expenditure Reports could result in Treasury taking action against the City for failure to comply with programmatic requirements. The City should implement and have controls in place to ensure the quarterly Project and Expenditure Reports are accurate.
2 CFR 1000.10 provides that, except for the deviations set forth elsewhere in this Part, the Department of Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards set forth at 2 CFR Part 200. 2 CFR 200.302(b) states, in part, that the financial management system of each non-Federal entity must provide for the accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. The City did not have proper internal controls in place to ensure the accurate submission of the Project and Expenditure Reports. During testing of Project and Expenditure Reports for the Coronavirus State and Local Fiscal Recovery Funds (AL #21.027), we noted that: ? The City did not properly report cumulative obligations on the report required by July 31, 2022. The City over-reported cumulative obligations due to including a funding project more than once for $880,000 to the Justice Center Design project; and ? The City did not properly report cumulative obligations nor current period expenditures on the report required by October 31, 2022. The City over-reported cumulative obligations by $880,000 due to including a funding project more than once to the Justice Center Design project. The City also over-reported current period expenditures due to including the current period expenditures of $175,741 for a funding project more than once to Rehiring Staff project. Failure to have the proper controls in place to ensure the timely and accurate submission of the Project and Expenditure Reports could result in Treasury taking action against the City for failure to comply with programmatic requirements. The City should implement and have controls in place to ensure the quarterly Project and Expenditure Reports are accurate.
2 CFR 1000.10 provides that, except for the deviations set forth elsewhere in this Part, the Department of Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards set forth at 2 CFR Part 200. 2 CFR 200.302(b) states, in part, that the financial management system of each non-Federal entity must provide for the accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. The City did not have proper internal controls in place to ensure the accurate submission of the Project and Expenditure Reports. During testing of Project and Expenditure Reports for the Coronavirus State and Local Fiscal Recovery Funds (AL #21.027), we noted that: ? The City did not properly report cumulative obligations on the report required by July 31, 2022. The City over-reported cumulative obligations due to including a funding project more than once for $880,000 to the Justice Center Design project; and ? The City did not properly report cumulative obligations nor current period expenditures on the report required by October 31, 2022. The City over-reported cumulative obligations by $880,000 due to including a funding project more than once to the Justice Center Design project. The City also over-reported current period expenditures due to including the current period expenditures of $175,741 for a funding project more than once to Rehiring Staff project. Failure to have the proper controls in place to ensure the timely and accurate submission of the Project and Expenditure Reports could result in Treasury taking action against the City for failure to comply with programmatic requirements. The City should implement and have controls in place to ensure the quarterly Project and Expenditure Reports are accurate.
2022-002 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards) Information on the Federal Program: United States Department of State Assistance Listing Number: 19.706 Assistance Listing Name: Partnership for Regional East Africa Counterterrorism Award Numbers: Direct Award Numbers Award Period SLMAQM20CA2264 September 28, 2020 through March 29, 2024 SLMAQM20GR2364 September 28, 2020 through September 30, 2024 Criteria: CFR Section ?200.510(b) states in part: ?The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section ?200.502 Basis for determining Federal awards expended.? The schedule must provide total Federal awards expended for each individual Federal program. In accordance with ?200.302 Financial Management, a non-federal entity?s financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. The financial management system of each non-federal entity must provide for the following: (1) Identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in ?200.327 Financial Reporting and ?200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets. Condition: The internal controls established for the review and approval of the SEFA to ensure its completeness and accuracy did not operate as designed. During our testing of management?s preparation of the SEFA, BDO identified two awards whose assistance listing number was changed by the federal entity in award amendments issued prior to December 31, 2022. Management failed to update the assistance listing number for the awards within the SEFA to address the award modifications. Questioned Costs: None. Context: The nature of these findings is detailed in the condition section above. Cause: The internal controls established for the review and approval of the SEFA to ensure its completeness and accuracy did not fully operate as designed. The Organization did not adequately review award modifications for changes to existing awards. Effect: The SEFA initially provided to BDO resulted in incorrect major program selection as prescribed under the Unform Guidance. During the review of the award agreements, BDO identified the assistance listing numbers for the two awards had been modified. This issue resulted in a different major program selection once the SEFA was updated to reflect the correct assistance listing numbers. Repeat Finding: This finding is not a repeat finding from prior year. Recommendation: We recommend management to continue to focus on training for both preparer and reviewers of the SEFA to ensure the documented policies and procedures can be performed as prescribed to comply with Section ?200.510(b). This will ensure that the SEFA provides all relevant information as proscribed.
2022-002 Internal Control over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards) Information on the Federal Program: United States Department of State Assistance Listing Number: 19.706 Assistance Listing Name: Partnership for Regional East Africa Counterterrorism Award Numbers: Direct Award Numbers Award Period SLMAQM20CA2264 September 28, 2020 through March 29, 2024 SLMAQM20GR2364 September 28, 2020 through September 30, 2024 Criteria: CFR Section ?200.510(b) states in part: ?The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section ?200.502 Basis for determining Federal awards expended.? The schedule must provide total Federal awards expended for each individual Federal program. In accordance with ?200.302 Financial Management, a non-federal entity?s financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. The financial management system of each non-federal entity must provide for the following: (1) Identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in ?200.327 Financial Reporting and ?200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets. Condition: The internal controls established for the review and approval of the SEFA to ensure its completeness and accuracy did not operate as designed. During our testing of management?s preparation of the SEFA, BDO identified two awards whose assistance listing number was changed by the federal entity in award amendments issued prior to December 31, 2022. Management failed to update the assistance listing number for the awards within the SEFA to address the award modifications. Questioned Costs: None. Context: The nature of these findings is detailed in the condition section above. Cause: The internal controls established for the review and approval of the SEFA to ensure its completeness and accuracy did not fully operate as designed. The Organization did not adequately review award modifications for changes to existing awards. Effect: The SEFA initially provided to BDO resulted in incorrect major program selection as prescribed under the Unform Guidance. During the review of the award agreements, BDO identified the assistance listing numbers for the two awards had been modified. This issue resulted in a different major program selection once the SEFA was updated to reflect the correct assistance listing numbers. Repeat Finding: This finding is not a repeat finding from prior year. Recommendation: We recommend management to continue to focus on training for both preparer and reviewers of the SEFA to ensure the documented policies and procedures can be performed as prescribed to comply with Section ?200.510(b). This will ensure that the SEFA provides all relevant information as proscribed.
FINDING 2022-004 Subject: Staffing for Adequate Fire and Emergency Response (SAFER) - Cash Management Federal Agency: Department of Homeland Security Federal Program: Staffing for Adequate Fire and Emergency Response (SAFER) Assistance Listings Number: 97.083 Federal Award Number and Year (or Other Identifying Number): EMW-2019-FF-00944 Compliance Requirement: Cash Management Audit Findings: Material Weakness, Modified Opinion Condition and Context The Township submits request for reimbursements to the Federal Emergency Management Agency of the Department of Homeland Security. The reimbursement method of cash management requires the Township to retain supporting documentation that shows the costs for which reimbursement was requested were paid prior to the reimbursement date. The Township was awarded a SAFER grant to increase the number of firefighters and was approved for personnel and fringe benefits costs, which includes health insurance, for nine additional firefighters. The Township is self-insured and would make payments to third-party administrators and other benefit coordinators. The Township would pay a large dollar amount at the end of each year to its selfinsurance benefit coordinators for the next year's benefit, and then additional payments throughout the year as needed for employee's medical claim coverage. These payments were made from various Township funds and the Payroll Deductions fund. Additionally, the payroll deductions for health insurance, including those for employees paid from the grant, would accumulate in the Payroll Deductions fund, and be used for payments to the benefit coordinators as needed and the payment of the next year's required funding. The amount submitted for reimbursement for health insurance benefits were based upon a calculation. The Township did not have supporting documentation for the calculation of those benefits that were claimed. In addition, the health insurance benefits claimed for reimbursement were not paid out of the SAFER Grant Fund and were not at a transaction level in the ledger. The health insurance benefit submitted for reimbursement could not be tied to a specific payment; thus, we were unable to determine the Township's compliance for the health benefit reimbursements being incurred and paid prior to the Township's request for reimbursement. The lack of internal controls and noncompliance were systemic issues throughout 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). . . ." 2 CFR 200.302 states in part: "(a) Each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. See also ? 200.450. (b) The financial management system of each non-Federal entity must provide for the following (see also ?? 200.334, 200.335, 200.336, and 200.337): (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. If a Federal awarding agency requires reporting on an accrual basis from a recipient that maintains its records on other than an accrual basis, the recipient must not be required to establish an accrual accounting system. This recipient may develop accrual data for its reports on the basis of an analysis of the documentation on hand. Similarly, a pass-through entity must not require a subrecipient to establish an accrual accounting system and must allow the subrecipient to develop accrual data for its reports on the basis of an analysis of the documentation on hand. (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. (4) Effective control over, and accountability for, all funds, property, and other assets. The non-Federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes. See ? 200.303. . . ." Cause A system of internal controls was not designed or implemented by management of the Township which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect management's expectation of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 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, health insurance benefits were requested for reimbursement without adequate supporting documentation that the amount was paid prior to the request. Noncompliance with the grant agreement and the cash management compliance requirement could result in the loss of future federal funds to the Township. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the Township establish a proper system of internal controls and develop policies and procedures to ensure expenses are paid prior to requesting reimbursement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2022-001 ? Finalize Budget Action Item Inaccuracies (Significant Deficiency) Identification of Federal Program: Name of Program: Shuttered Venue Operators Grant Program Assistance Listing Number: 59.075 Award Year: 2022 Pass-Through Entity: Direct Name of Federal Agency: U.S. Small Business Administration (?SBA?) Criteria: 2 CFR section 200.328 describes the financial reporting requirements for federal grant recipients. The terms and conditions of the award require the awardee to complete and submit the SF-425 report and a finalized budget (?Expense Report by Applicant?) using accurate data during the grant closeout process. The Finalized Budget Action Item allows grantees to update their budgets to reflect their finalized award and/or update allocations to allowable cost categories to align with actual or projected use of funds to date. Grantees do not need to request SBA approval to move costs between allowable cost categories. All grantees must complete the Finalize Budget Action Item. Condition: The following inaccuracies were noted within each allowable cost category reported on the Expense Report by Applicant, compared to actual expenses: Allowable Cost Category Expense Report by Applicant Actual expenses Difference 3. Equipment $ 40,000 $ - $ 40,000 5. Supplies 20,000 36,546 (16,546) 6. Contractual - 750,000 (750,000) 6b. Operating Leases 450,000 36,144 413,856 8d. Scheduled Debt Payments 550,000 - 550,000 8f. Other Business Expenses 60,000 14,299 45,701 8g. Administrative costs 20,000 8,032 11,968 8h. Insurance Payments 6,000 - 6,000 8i. Advertising 586,500 887,479 (300,979) Total $ 1,732,500 $ 1,732,500 $ - Cause: The errors in the Finalize Budget Action Item were due to inadequate review during the closeout process to ensure that the amounts reported agreed to actual grant expenditures. The management of the Association incorrectly believed that actual expenditures should exactly match the original budget which was initially approved. Effect: Improper preparation of the Finalize Budget Action Item resulted in the report being submitted while containing inaccurate amounts being reported within all allowable cost categories No questioned costs are reported within this finding, as the Association?s actual expenditures were greater than the federal award received, and all disbursements were for the purposes and objectives set forth in the terms and conditions of the federal award. Recommendation: The Association should review financial reports prior to submission and ensure that amounts agree to internal financial data, and are in compliance with the grant agreement. Views of Responsible Officials: Management of the Association concurs with the audit finding. The Association will enact procedures to ensure that grant reports are submitted with accurate financial information.
FINDING 2022-002 Condition: The Organization filed some of its SF-425 Federal Financial Reports with inaccurate expenditure amounts. The amounts did not agree with the Organization?s grant expense tracking system. The auditor discovered the inaccurate reports when testing the grant revenue for significant federal awards as part of the financial audit. The inaccurate reports were associated with at least two of eight federal awards spent during 2022 but were not associated with the major program that was tested. The inaccurate reports typically showed expenditures in an amount equal to the total award pro-rated equally on a quarterly basis over the award period, instead of actual expenditures. In some cases, this resulted in the SF-425 reporting more expenditures than actually incurred. Some of the dates were also inaccurate or did not get updated properly. Criteria: The Uniform Guidance (2 CFR section 200.328) addresses requirements regarding financial reporting. The Organization?s federal award contracts typically require the SF-425 report to be filed quarterly and that the report be true, complete, and accurate. Cause: The Organization inadvertently had some typographical errors in the report. There was also confusion regarding how to accurately complete the report. Effect: The Organization filed inaccurate SF-425 Federal Financial Reports for some of its federal awards. This did not directly affect the major program that was tested during the audit but is considered a significant deficiency in internal control over compliance, particularly compliance related to reporting, for federal awards. It is also considered to be noncompliance with federal award programs that were not tested as major programs. No adjustment to the financial statements was required. Recommendation: The Organization should reevaluate its procedures and controls regarding federal financial reporting, particularly the accuracy of the reporting, to ensure proper compliance. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and plans to carry out the noted recommendation.
FINDING 2022-002 Condition: The Organization filed some of its SF-425 Federal Financial Reports with inaccurate expenditure amounts. The amounts did not agree with the Organization?s grant expense tracking system. The auditor discovered the inaccurate reports when testing the grant revenue for significant federal awards as part of the financial audit. The inaccurate reports were associated with at least two of eight federal awards spent during 2022 but were not associated with the major program that was tested. The inaccurate reports typically showed expenditures in an amount equal to the total award pro-rated equally on a quarterly basis over the award period, instead of actual expenditures. In some cases, this resulted in the SF-425 reporting more expenditures than actually incurred. Some of the dates were also inaccurate or did not get updated properly. Criteria: The Uniform Guidance (2 CFR section 200.328) addresses requirements regarding financial reporting. The Organization?s federal award contracts typically require the SF-425 report to be filed quarterly and that the report be true, complete, and accurate. Cause: The Organization inadvertently had some typographical errors in the report. There was also confusion regarding how to accurately complete the report. Effect: The Organization filed inaccurate SF-425 Federal Financial Reports for some of its federal awards. This did not directly affect the major program that was tested during the audit but is considered a significant deficiency in internal control over compliance, particularly compliance related to reporting, for federal awards. It is also considered to be noncompliance with federal award programs that were not tested as major programs. No adjustment to the financial statements was required. Recommendation: The Organization should reevaluate its procedures and controls regarding federal financial reporting, particularly the accuracy of the reporting, to ensure proper compliance. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and plans to carry out the noted recommendation.
2022-001 Internal Control over Compliance and Compliance with the Reporting Compliance Requirement See Schedule of Findings and Questioned Costs for chart/table. Criteria or Specific Requirement: In accordance with ?200.303(a), Internal Controls, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. ?200.328, Monitoring and Reporting Program Performance, documents that the non-federal entity is responsible for oversight of the operations of the federal award supported activities. The non-federal entity must monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved. Monitoring by the non-federal entity must cover each program, function or activity. The non-federal entity must submit performance reports at the interval required by the federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the federal award or could significantly affect program outcomes. In accordance with the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The prime awardee is required to file a Transparency Act sub-award report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. Condition: During BDO?s testing of the performance reporting requirements, BDO noted management continues to rely upon a manual process related to tracking and monitoring performance reporting. Programmatic Report Testing For one of six performance reports tested for major program AL# 93.067, a report was submitted after the due date without approval for late submission. Federal Funding Accountability and Transparency Act Reporting Testing We also performed testing over the Transparency Act reporting requirements outlined in the criteria section above. The OMB Compliance Supplement requires certain information be included in the finding when non-compliance exists. Of the 72 subaward original agreements and modifications totaling $10,993,519 (award amounts) for award 7200AA18C00014 that were tested, nine of the 72 reports with award amounts totaling $505,573 were not submitted timely. Of the four subaward original agreements and modifications totaling $731,250 (award amounts) for award NU2GGH002295 that were tested, one of the four reports with an award amount totaling $166,250 was not submitted timely. Questioned Costs: There are no questioned costs as the items described above are all related to late submission of reports. Context: This is a condition identified during BDO?s testing of performance reports and Transparency Act reports. Our sample for performance reporting was selected through a non-statistical sample. Our sample for Transparency Act reporting was selected based on a population of Transparency Act reports provided by management as well as through our subrecipient monitoring testing at the subrecipient level. We tested all Transparency Act report submissions in 2022 for the subrecipients selected for testing. Our sample for Transparency Act reporting was selected through non-statistical sampling. Cause: The quasi-manual performance reporting continues to challenge PSI given the number of awards under management and the number of reports required. PSI programmatic personnel have been unable to ensure the timely submission of reports because of this manual process. Effect: Failure to properly track all performance reporting requirements and Transparency Act reporting requirements impacts the Federal agency from obtaining performance information required to assess award performance on a macro level. Such non-compliance also increases the risk of loss of future awards if compliance with award terms are not met. Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2021-001 in the 2021 schedule of findings and questioned costs. Recommendation: In order to facilitate accurate and timely reporting and compliance with the terms and conditions of federal awards, BDO recommends management ensure all performance reporting requirements are maintained, updated, and available in a central location. BDO also recommends management implement a process by which approvals, submission considerations and supporting documentation for programmatic reports and Transparency Act reports is maintained in a centralized location. Views of Responsible Officials: Management agrees with the finding and recommendations set forth within and will work with project teams to review and confirm the accuracy of reporting deadlines. Refer to management?s corrective action plan for additional information.
Finding 2022-02: 15.631 Partners for Fish and Wildlife Criteria: 2 CFR 200.328 requires entities to comply with financial reporting as communicated in the federal award terms. Condition and Context: For the year ended December 31, 2022, Klamath Watershed Partnership?s financial reporting were reported on form SF-425 for the multiple federal awards under the Partners for Fish and Wildlife program. 4 reports were identified with inaccuracies. Cause: Klamath Watershed Partnership incidentally reported amounts on specific lines that weren?t aligned with the amounts supported through underlying records. Effect or Potential Effect: The reports filed reported erroneous amounts for multiple federal awards. Questioned Costs: None Context: The reports were prepared accurately in most of the SF-425 reports, but there were 4 reports that were not accurate. These 4 reports varied in the areas of the discrepancies. This suggests that the issue is not isolated or systemic, but a combination of both. Recommendation: Klamath Watershed Partnership should attach the report or other information used to prepare the reports for the use of the employee responsible for reviewing the report prior to filing. Also, management should amend the reports identified. Views of responsible officials and planned corrective actions: Management agrees with the finding and will perform a review with supporting information in future filings. Also, management will amend the identified reports.
FINDING 2022-004 ? CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS - REPORTING Federal Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds (ALN Number: 21.027) Federal Agency: Department of Treasury Federal Award Number (or Other Identifying Number): N/A Pass-Through Entity: State Budget Agency Audit Finding: Significant Deficiency Criteria: 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 Financial reporting . . . ." 34 CFR 76.722 states: "A State may require a subgrantee to submit reports in a manner and format that assists the State in complying with the requirements under 34 CFR 76.720 and in carrying out other responsibilities under the program." Condition: During testing, we noted the County did not have a review control in place to ensure accuracy and completeness of the quarterly reporting requirements. Questioned Cost: None.Context: There was no documented review by someone other than the preparers of the Project and Expenditure Report to ensure the information submitted was accurate and complete. The reports are prepared and submitted by the County Attorney without secondary review. As a result, one of the quarterly reports selected for testing, out of a sample of two reports, was overstated by $247,770 in one period due to improper inclusion of an expenditure made in a subsequent month. This timing error was corrected on the next quarterly support and similar errors were not identified in subsequent quarters. Final reporting of total expenditures was accurate. Effect: The failure to establish an effective internal control system placed the County at risk of noncompliance with the grant agreement and the compliance requirements. A lack of segregation of duties within an internal control system could have allowed noncompliance with the compliance requirements and allowed the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the program. Cause: Management had not developed a system of internal control that would have ensured compliance with the grant agreement and the compliance requirements listed above for the full period under audit. Repeat Finding: No. Recommendation: We recommended that the County's management establish a system of internal control to ensure compliance with the grant agreement and the compliance requirements listed above. We recommend an individual other than the County Attorney perform a documented review of the report prior to submission. Views of Responsible Officials: Management concurs with this finding. See the corrective action plan.
2 CFR ? 1000 gives regulatory effect to the United States Department of Treasury for 2 CFR ? 200.328 and 329 which states, in part, that unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly. Additionally, program-specific reporting requirements under the Emergency Rental Assistance Program 1 & 2 (ERA) and State and Local Fiscal Recovery Funds (SLFRF), requires all ERA and SLFRF grantees must submit quarterly reports with reporting periods of one calendar quarter and several cumulative fields covering all activity from the date of award through the quarter close. The key line items in the form are: 1. The cumulative amount obligated by the grantee; and 2. The cumulative amount expended by the grantee Additionally, 2 CFR Subpart F ? 200.510(b) requires the auditee to prepare a Schedule of Expenditures of Federal Awards (the Schedule) for the period covered by the County?s financial statements which must include the total federal awards expended as determined in accordance with ? 200.502. At a minimum, the schedule must: (1) List individual Federal programs by Federal agency. (2) For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. (3) Provide total Federal awards expended for each individual Federal program and the AL number or other identifying number when the AL information is not available. (4) Include the total amount provided to subrecipients from each Federal program. (5) For loan or loan guarantee programs described in ? 200.502 Basis for determining Federal awards expended, paragraph (b), identify in the notes to the schedule the balances outstanding at the end of the audit period. (6) Include notes that describe the significant accounting policies used in preparing the schedule, and note whether or not the auditee has elected to use the 10 percent de minimis cost rate as covered in ? 200.414 Indirect (F&A) costs. Testing over the County's quarterly reporting requirements for the ERA program identified the following: "See Schedule of Findings for table" Furthermore, testing over the County's quarterly reporting requirements for the SLFRF program identified the following: "See Schedule of Findings for table" Furthermore, the lack of effective controls over this compliance requirement resulted in the Schedule being misstated. As a result of the cumulative expenditure amounts being incorrectly reported for the SLFRF program, the County's Schedule of Expenditures of Federal Awards (Schedule) was overstated by $3,091,886. Adjustments, to which management have agreed, are reflected in the accompanying Schedule. Noncompliance with grant requirements as well as errors and omissions on the Schedule of Expenditures of Federal Awards could have an adverse effect on future grant awards by the awarding agency in addition to an inaccurate assessment of major federal programs that would be subjected to audit. County management should review all grant and loan award documents in order to execute policies and procedures which help ensure compliance with grant and loan requirements, including Schedule reporting requirements. The County should implement a system to track all federal expenditures and related information separately from other expenditures and report federal expenditures with proper support including, but not limited to, grant agreements, calculation of the expenditures, and any federal reporting requirements. This will help ensure the County is in compliance with grant and loan requirements, the Schedule is complete and accurate, and major federal programs are accurately identified for audit.
2 CFR ? 1000 gives regulatory effect to the United States Department of Treasury for 2 CFR ? 200.328 and 329 which states, in part, that unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly. Additionally, program-specific reporting requirements under the Emergency Rental Assistance Program 1 & 2 (ERA) and State and Local Fiscal Recovery Funds (SLFRF), requires all ERA and SLFRF grantees must submit quarterly reports with reporting periods of one calendar quarter and several cumulative fields covering all activity from the date of award through the quarter close. The key line items in the form are: 1. The cumulative amount obligated by the grantee; and 2. The cumulative amount expended by the grantee Additionally, 2 CFR Subpart F ? 200.510(b) requires the auditee to prepare a Schedule of Expenditures of Federal Awards (the Schedule) for the period covered by the County?s financial statements which must include the total federal awards expended as determined in accordance with ? 200.502. At a minimum, the schedule must: (1) List individual Federal programs by Federal agency. (2) For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. (3) Provide total Federal awards expended for each individual Federal program and the AL number or other identifying number when the AL information is not available. (4) Include the total amount provided to subrecipients from each Federal program. (5) For loan or loan guarantee programs described in ? 200.502 Basis for determining Federal awards expended, paragraph (b), identify in the notes to the schedule the balances outstanding at the end of the audit period. (6) Include notes that describe the significant accounting policies used in preparing the schedule, and note whether or not the auditee has elected to use the 10 percent de minimis cost rate as covered in ? 200.414 Indirect (F&A) costs. Testing over the County's quarterly reporting requirements for the ERA program identified the following: "See Schedule of Findings for table" Furthermore, testing over the County's quarterly reporting requirements for the SLFRF program identified the following: "See Schedule of Findings for table" Furthermore, the lack of effective controls over this compliance requirement resulted in the Schedule being misstated. As a result of the cumulative expenditure amounts being incorrectly reported for the SLFRF program, the County's Schedule of Expenditures of Federal Awards (Schedule) was overstated by $3,091,886. Adjustments, to which management have agreed, are reflected in the accompanying Schedule. Noncompliance with grant requirements as well as errors and omissions on the Schedule of Expenditures of Federal Awards could have an adverse effect on future grant awards by the awarding agency in addition to an inaccurate assessment of major federal programs that would be subjected to audit. County management should review all grant and loan award documents in order to execute policies and procedures which help ensure compliance with grant and loan requirements, including Schedule reporting requirements. The County should implement a system to track all federal expenditures and related information separately from other expenditures and report federal expenditures with proper support including, but not limited to, grant agreements, calculation of the expenditures, and any federal reporting requirements. This will help ensure the County is in compliance with grant and loan requirements, the Schedule is complete and accurate, and major federal programs are accurately identified for audit.
2022-001 Internal Control over Compliance and Compliance with the Reporting Compliance Requirement See Schedule of Findings and Questioned Costs for chart/table. Criteria or Specific Requirement: In accordance with ?200.303(a), Internal Controls, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. ?200.328, Monitoring and Reporting Program Performance, documents that the non-federal entity is responsible for oversight of the operations of the federal award supported activities. The non-federal entity must monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved. Monitoring by the non-federal entity must cover each program, function or activity. The non-federal entity must submit performance reports at the interval required by the federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the federal award or could significantly affect program outcomes. In accordance with the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The prime awardee is required to file a Transparency Act sub-award report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. Condition: During BDO?s testing of the performance reporting requirements, BDO noted management continues to rely upon a manual process related to tracking and monitoring performance reporting. Programmatic Report Testing For one of six performance reports tested for major program AL# 93.067, a report was submitted after the due date without approval for late submission. Federal Funding Accountability and Transparency Act Reporting Testing We also performed testing over the Transparency Act reporting requirements outlined in the criteria section above. The OMB Compliance Supplement requires certain information be included in the finding when non-compliance exists. Of the 72 subaward original agreements and modifications totaling $10,993,519 (award amounts) for award 7200AA18C00014 that were tested, nine of the 72 reports with award amounts totaling $505,573 were not submitted timely. Of the four subaward original agreements and modifications totaling $731,250 (award amounts) for award NU2GGH002295 that were tested, one of the four reports with an award amount totaling $166,250 was not submitted timely. Questioned Costs: There are no questioned costs as the items described above are all related to late submission of reports. Context: This is a condition identified during BDO?s testing of performance reports and Transparency Act reports. Our sample for performance reporting was selected through a non-statistical sample. Our sample for Transparency Act reporting was selected based on a population of Transparency Act reports provided by management as well as through our subrecipient monitoring testing at the subrecipient level. We tested all Transparency Act report submissions in 2022 for the subrecipients selected for testing. Our sample for Transparency Act reporting was selected through non-statistical sampling. Cause: The quasi-manual performance reporting continues to challenge PSI given the number of awards under management and the number of reports required. PSI programmatic personnel have been unable to ensure the timely submission of reports because of this manual process. Effect: Failure to properly track all performance reporting requirements and Transparency Act reporting requirements impacts the Federal agency from obtaining performance information required to assess award performance on a macro level. Such non-compliance also increases the risk of loss of future awards if compliance with award terms are not met. Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2021-001 in the 2021 schedule of findings and questioned costs. Recommendation: In order to facilitate accurate and timely reporting and compliance with the terms and conditions of federal awards, BDO recommends management ensure all performance reporting requirements are maintained, updated, and available in a central location. BDO also recommends management implement a process by which approvals, submission considerations and supporting documentation for programmatic reports and Transparency Act reports is maintained in a centralized location. Views of Responsible Officials: Management agrees with the finding and recommendations set forth within and will work with project teams to review and confirm the accuracy of reporting deadlines. Refer to management?s corrective action plan for additional information.
2022-001 Internal Control over Compliance and Compliance with the Reporting Compliance Requirement See Schedule of Findings and Questioned Costs for chart/table. Criteria or Specific Requirement: In accordance with ?200.303(a), Internal Controls, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. ?200.328, Monitoring and Reporting Program Performance, documents that the non-federal entity is responsible for oversight of the operations of the federal award supported activities. The non-federal entity must monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved. Monitoring by the non-federal entity must cover each program, function or activity. The non-federal entity must submit performance reports at the interval required by the federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the federal award or could significantly affect program outcomes. In accordance with the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the ?Transparency Act? that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The prime awardee is required to file a Transparency Act sub-award report by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. Condition: During BDO?s testing of the performance reporting requirements, BDO noted management continues to rely upon a manual process related to tracking and monitoring performance reporting. Programmatic Report Testing For one of six performance reports tested for major program AL# 93.067, a report was submitted after the due date without approval for late submission. Federal Funding Accountability and Transparency Act Reporting Testing We also performed testing over the Transparency Act reporting requirements outlined in the criteria section above. The OMB Compliance Supplement requires certain information be included in the finding when non-compliance exists. Of the 72 subaward original agreements and modifications totaling $10,993,519 (award amounts) for award 7200AA18C00014 that were tested, nine of the 72 reports with award amounts totaling $505,573 were not submitted timely. Of the four subaward original agreements and modifications totaling $731,250 (award amounts) for award NU2GGH002295 that were tested, one of the four reports with an award amount totaling $166,250 was not submitted timely. Questioned Costs: There are no questioned costs as the items described above are all related to late submission of reports. Context: This is a condition identified during BDO?s testing of performance reports and Transparency Act reports. Our sample for performance reporting was selected through a non-statistical sample. Our sample for Transparency Act reporting was selected based on a population of Transparency Act reports provided by management as well as through our subrecipient monitoring testing at the subrecipient level. We tested all Transparency Act report submissions in 2022 for the subrecipients selected for testing. Our sample for Transparency Act reporting was selected through non-statistical sampling. Cause: The quasi-manual performance reporting continues to challenge PSI given the number of awards under management and the number of reports required. PSI programmatic personnel have been unable to ensure the timely submission of reports because of this manual process. Effect: Failure to properly track all performance reporting requirements and Transparency Act reporting requirements impacts the Federal agency from obtaining performance information required to assess award performance on a macro level. Such non-compliance also increases the risk of loss of future awards if compliance with award terms are not met. Repeat Finding: This is a repeat finding from the prior year. This was reported as finding 2021-001 in the 2021 schedule of findings and questioned costs. Recommendation: In order to facilitate accurate and timely reporting and compliance with the terms and conditions of federal awards, BDO recommends management ensure all performance reporting requirements are maintained, updated, and available in a central location. BDO also recommends management implement a process by which approvals, submission considerations and supporting documentation for programmatic reports and Transparency Act reports is maintained in a centralized location. Views of Responsible Officials: Management agrees with the finding and recommendations set forth within and will work with project teams to review and confirm the accuracy of reporting deadlines. Refer to management?s corrective action plan for additional information.
FINDING 2022-003 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): CY 2020 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2021-004. Condition and Context The Town had not designed or implemented adequate internal controls and procedures to ensure that reports were prepared, accurate, and submitted in accordance with the applicable compliance requirements for the federal grant. The United States Department of Agriculture (USDA) requires the following two financial reports be submitted annually: 1. Statement of Budget, Income and Equity, (Form RD 442-2) 2. Balance Sheet (Form RD 442-3) The Form RD 442-2 covers financial operations relating to the borrower's water or waste disposal project. The Form RD 442-3 presents the financial status of the borrower's water or waste disposal project. In both instances, a borrower may submit the financial data on other forms, provided the forms are in a similar format and signed and dated by the organization's official to certify the correctness of the information. Alternatively, an annual audit may be submitted in lieu of the forms. The Town was required to file each report, as noted above, during the audit period. Both reports were selected for testing. Per inquiry with the Town and review of its records, the Town attempted to prepare Form RD 442-2; however, the report was never completed, nor was it filed with the appropriate authorities. Additionally, the Town did not file or even attempt to prepare Form RD 442-3. Neither alternative reports nor a financial statement were submitted to the USDA in lieu of the forms. The lack of internal controls and noncompliance were systemic issues, which occurred throughout 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). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. . . ." 7 CFR 1780.47 states in part: "Borrower accounting methods, management reporting and audits. . . . (e) Borrowers exempt from audits. All borrowers who are exempt from audits, will, within 60 days following the end of each fiscal year, furnish the RUS with annual financial statements, consisting of a verification of the organization's balance sheet and statement of income and expense by an appropriate official of the organization. Forms RD 442-2, 'Statement of Budget, Income and Equity,' and 442-3 may be used. (f) Management reports. These reports will furnish management with a means of evaluating prior decisions and serve as a basis for planning future operations and financial strategies. In those cases where revenues from multiple sources are pledged as security for an RUS loan, two reports will be required; one for the project being financed by RUS and one combining the entire operation of the borrower. In those cases where RUS loans are secured by general obligation bonds or assessments and the borrower combines revenues from all sources, one management report combining all such revenues is acceptable. The following management data will be submitted by the borrower to the processing office. These reports at a minimum will include a balance sheet and income and expense statement. . . . (2) Annual management reports. Prior to the beginning of each fiscal year the following will be submitted to the processing office. (If Form RD 442-2 is used as the annual management report, enter data in column three only of Schedule 1, and complete all of Schedule 2.) (i) Two copies of the management reports and proposed 'Annual Budget.' (ii) Financial information may be reported on Form RD 442-2 which includes Schedule 1, 'Statement of Budget, Income and Equity' and Schedule 2, 'Projected Cash Flow' or information in similar format. (iii) A copy of the rate schedule in effect at the time of submission. (g) Substitute for management reports. When RUS loans are secured by the general obligation of the public body or tax assessments which total 100 percent of the debt service requirements, the State program official may authorize an annual audit to substitute for other management reports if the audit is received within nine months after the end of the audit period." Cause A proper system of internal controls was not designed by management of the Town. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the Town's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 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, required reports were not filed with the USDA. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the Town. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the Town establish a proper system of internal controls and develop policies and procedures to ensure required reports, or allowable alternatives are completed and filed with the USDA. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding 2022-002 Department of Transportation Federal Financial Assistance Listing 20.106; Awards AIP3-46-0050-57 and AIP3-46-0050-61 Airport Improvement Program Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria - 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition - The SF-425 annual report dated September 30, 2022, for award AIP3-46-0050-57 overreported the federal share of expenditures by $1,347, while the SF-425 annual report dated September 30, 2022, for award AIP3-46-0050-61 underreported the federal share of expenditures by $1,494,690. Cause - The Authority does not have an internal control structure designed to ensure amounts reported on SF-425 reports are adequately reviewed and agree to underlying accounting records. Effect - Lack of compliance with designed internal controls over reporting could result in the Authority reporting incorrect or incomplete information. Questioned Costs - None reported. Context/Sampling - A nonstatistical sample of 4 reports out of 12 reports. Repeat Finding from Prior Year - No Recommendation - Management should determine and formalize reporting responsibilities between the Airport and the State and establish review processes to ensure that amounts included in SF-425 reports agree with the underlying accounting records. Views of Responsible Officials - Management agrees with the finding.
Finding 2022-002 Department of Transportation Federal Financial Assistance Listing 20.106; Awards AIP3-46-0050-57 and AIP3-46-0050-61 Airport Improvement Program Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria - 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal controls over the federal awards that provide assurance that the entity is managing the federal awards in compliance with federal statutes, regulations, and the conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition - The SF-425 annual report dated September 30, 2022, for award AIP3-46-0050-57 overreported the federal share of expenditures by $1,347, while the SF-425 annual report dated September 30, 2022, for award AIP3-46-0050-61 underreported the federal share of expenditures by $1,494,690. Cause - The Authority does not have an internal control structure designed to ensure amounts reported on SF-425 reports are adequately reviewed and agree to underlying accounting records. Effect - Lack of compliance with designed internal controls over reporting could result in the Authority reporting incorrect or incomplete information. Questioned Costs - None reported. Context/Sampling - A nonstatistical sample of 4 reports out of 12 reports. Repeat Finding from Prior Year - No Recommendation - Management should determine and formalize reporting responsibilities between the Airport and the State and establish review processes to ensure that amounts included in SF-425 reports agree with the underlying accounting records. Views of Responsible Officials - Management agrees with the finding.
FINDING 2022-007 Subject: CDBG - Entitlement Grants Cluster - Reporting Federal Agency: Department of Housing and Urban Development Federal Programs: Community Development Block Grants/Entitlement Grants, COVID-19 - Community Development Block Grants/Entitlement Grants Assistance Listings Number: 14.218 Federal Award Numbers and Years (or Other Identifying Numbers): B-19-MC-18-0015, B-20-MC-20-0015, B-20-MW-18-0015, B-21-MC-18-0015, B-22-MC-18-0015 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2021-004. Condition and Context Financial Reporting For each CDBG award, the City is required to submit financial reports to Housing and Urban Development (HUD). The financial reports to be submitted are a quarterly CDBG Cash on Hand (PR29) report and an annual CDBG Financial Summary (PR26). The Community Development Specialist prepared the annual PR26 and quarterly PR29 reports without evidence of a review or an approval process to ensure accuracy of the reports submitted. During the audit period, there were three PR26 reports and six PR29 reports due. Four reports were selected for testing, two PR26 reports and two PR29 reports. One of the two PR26 reports was not supported by the City's records, and one of the two PR29 reports contained errors when reporting cash on hand. Performance Reporting The City is required to enter HUD 60002, Section 3 Summary Report, Economic Opportunities for Low- and Very Low-Income Persons report (Section 3) activities on the closeout screens in the Integrated Disbursement and Information System (IDIS), as well as within the Consolidated Annual Performance and Evaluation Report (CAPER). The Section 3 report was not submitted on the closeout screens in the IDIS as part of the closeout process. The City did submit the Section 3 information within the CAPER; however, the Section 3 information was not supported by the City's records. The City was not able to provide documentation supporting the Section 3 information in the CAPER. Special Reporting for Federal Funding Accountability and Transparency Act (FFATA) Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282) (Transparency Act), recipients (i.e., direct recipients) of grants or cooperative agreements who make first tier subawards of $30,000 or more are required to register in the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) and report subaward data through the FSRS. INDIANA STATE BOARD OF ACCOUNTS 28 CITY OF ELKHART SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) There were two subawards that required submission in the FSRS during the audit period. The due date for the information was August 31, 2022, and November 30, 2022, respectively. The information was completed and submitted by the City; however, there was no documentation of the review or oversight process in place to ensure the accuracy of the information submitted. (See Report PDF for Schedule.) The lack of internal controls and noncompliance were systemic issues throughout 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). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. . . ." Cause A proper system of internal controls was not designed by management of the City. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the City's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 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, required reports were not accurate nor submitted timely. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the City. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the City design and implement a proper system of internal control, including policies and procedures that would provide segregation of duties to ensure required reports are submitted timely and accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2022-007 Subject: CDBG - Entitlement Grants Cluster - Reporting Federal Agency: Department of Housing and Urban Development Federal Programs: Community Development Block Grants/Entitlement Grants, COVID-19 - Community Development Block Grants/Entitlement Grants Assistance Listings Number: 14.218 Federal Award Numbers and Years (or Other Identifying Numbers): B-19-MC-18-0015, B-20-MC-20-0015, B-20-MW-18-0015, B-21-MC-18-0015, B-22-MC-18-0015 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2021-004. Condition and Context Financial Reporting For each CDBG award, the City is required to submit financial reports to Housing and Urban Development (HUD). The financial reports to be submitted are a quarterly CDBG Cash on Hand (PR29) report and an annual CDBG Financial Summary (PR26). The Community Development Specialist prepared the annual PR26 and quarterly PR29 reports without evidence of a review or an approval process to ensure accuracy of the reports submitted. During the audit period, there were three PR26 reports and six PR29 reports due. Four reports were selected for testing, two PR26 reports and two PR29 reports. One of the two PR26 reports was not supported by the City's records, and one of the two PR29 reports contained errors when reporting cash on hand. Performance Reporting The City is required to enter HUD 60002, Section 3 Summary Report, Economic Opportunities for Low- and Very Low-Income Persons report (Section 3) activities on the closeout screens in the Integrated Disbursement and Information System (IDIS), as well as within the Consolidated Annual Performance and Evaluation Report (CAPER). The Section 3 report was not submitted on the closeout screens in the IDIS as part of the closeout process. The City did submit the Section 3 information within the CAPER; however, the Section 3 information was not supported by the City's records. The City was not able to provide documentation supporting the Section 3 information in the CAPER. Special Reporting for Federal Funding Accountability and Transparency Act (FFATA) Under the requirements of the Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282) (Transparency Act), recipients (i.e., direct recipients) of grants or cooperative agreements who make first tier subawards of $30,000 or more are required to register in the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) and report subaward data through the FSRS. INDIANA STATE BOARD OF ACCOUNTS 28 CITY OF ELKHART SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) There were two subawards that required submission in the FSRS during the audit period. The due date for the information was August 31, 2022, and November 30, 2022, respectively. The information was completed and submitted by the City; however, there was no documentation of the review or oversight process in place to ensure the accuracy of the information submitted. (See Report PDF for Schedule.) The lack of internal controls and noncompliance were systemic issues throughout 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). . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. . . ." Cause A proper system of internal controls was not designed by management of the City. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the City's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. 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, required reports were not accurate nor submitted timely. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the City. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the City design and implement a proper system of internal control, including policies and procedures that would provide segregation of duties to ensure required reports are submitted timely and accurately. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Identification of the Federal Program: U.S. Department of Health and Human Services ? COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Distribution ? 93.498 Criteria: RWHS must establish and maintain effective internal control over federal awards that provides reasonable assurance that RWHS is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with program requirements. Terms and conditions of the federal award require the quarterly revenue on an actual and budgeted basis to be reported to the federal agency by March 31, 2023. Condition: RWHS submitted instances of inaccurate actual revenue for quarters 3 and 4 of 2021 and 2022 and inaccurate budgeted revenue for quarters 2 and 3 of 2021. Cause: RWHS did not have a control in place to assure proper reporting of the quarterly revenue totals. Effect: The quarterly revenue totals reported to the federal agency were inaccurate in 2021 and 2022. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management implement procedures to ensure that the required revenue totals are reported accurately in accordance with the terms and conditions of the federal award. Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.
FINDING 2022-001 Subject: Formula Grants for Rural Areas and Tribal Transit Program - Reporting Federal Agency: Department of Transportation Federal Program: Formula Grants for Rural Areas and Tribal Transit Program Assistance Listings Number: 20.509 Federal Award Numbers and Years (or Other Identifying Numbers): 1804006O, 1803906O Pass-Through Entity: Indiana Department of Transportation Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The City had not properly designed or implemented a system of internal controls that would likely be effective in preventing, or detecting and correcting, noncompliance. Recipients of the Formula Grants for Rural Areas and Tribal Transit Program are required to submit claim vouchers quarterly to the Indiana Department of Transportation (INDOT). Each quarterly reimbursement request is to reflect the total expenditures for the quarter then ended. The City submitted a total of five claim vouchers during the audit period; however, one of the claim vouchers was not properly prepared. The fourth quarter claim voucher for 2021, covering the period of October 2021 to December 2021, submitted to the INDOT by the City, incorrectly included the expenditures for September 2021 instead of the expenditures for October 2021. This caused the September 2021 expenditures to be reimbursed for a second time, and the October 2021 expenditures to not be reimbursed. The September 2021 expenditure amount was $72,824; however, the October 2021 expenditure amount was $182,909. The October 2021 expenditures have not been requested for reimbursement to date. The lack of internal controls and noncompliance was isolated to the fourth quarter claim voucher for 2021. 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). . . ." 2 CFR 200.328 states: "Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMBapproved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as applicable, when providing financial and performance reporting information." Cause A proper system of internal controls over the quarterly expenditure report was not designed by management of the City to ensure the correct expenditures were requested for reimbursement. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the City's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the City. In addition, not requesting reimbursement for the correct amount led to the City not being reimbursed for all applicable expenditures. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the City design and implement a proper system of internal controls that would provide a segregation of duties for the preparation and review of federal reports to ensure appropriate reviews, approvals, and oversight are taking place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
"Finding 2022-007 Reporting – Significant Deficiency. Criteria: 2 CFR section 200.328 states that information must be collected with the frequency required by the terms and conditions of the Federal award. The Organization’s Project Service Agreement indicates that invoices for monthly financial reporting are due to the pass-through entity by the tenth business day of the month for the previous calendar month, except for the last invoice of the 2022 calendar year which was due on January 10, 2023. Questioned Costs: Not applicable. Repeat Finding: Not applicable as the Organization is a first time auditee. Recommendation: We recommend that the Organization develop more effective policies and controls to ensure that the reports are remitted within the time frame specified in the agreements. Views of Responsible Official: See Corrective Action Plan. Condition: In our sample of four monthly invoices, all four were submitted after the deadline prescribed in the agreement. Cause: The Organization has no controls in place to ensure that reports are remitted on a timely basis. Effect: The effect is minimal since the pass-through entity still accepted the reports and reimbursed the Organization for the majority of the requested funds."
#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.
#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
2022-001: Late Filing of the Data Collection Form All Federal programs included in the Schedule of Expenditures of Federal Awards Compliance Findings: Other (P) Condition: Range Mental Health Center, Inc. and Subsidiary did not submit its single audit reporting package to the Federal Audit Clearinghouse within the required time frame. Criteria: 2 CFR 200.328 establishes requirements for financial grant reporting by a nonfederal entity. The Organization must report financial information as required by the terms and conditions of the federal award. 2 CFR 200.512(a) requires the audit reporting package and data collection form to be submitted to the Federal Audit Clearinghouse the earlier of 30 days after the reports are received from the auditors or nine months after the end of the audit period. Cause: Employee turnover in the finance department resulted in financial and program data not being ready for the financial and single audits on a timely basis. Effect: The Organization is not in compliance with timely reporting requirements. Questioned Costs: $0 Context: Range Mental Health Center, Inc. and Subsidiary did not submit its year ended December 31, 2021 audit reporting package to the Federal Audit Clearinghouse until April 4, 2023, and did not meet the nine month reporting requirement for the year ended December 31, 2022. Recommendation: We recommend Range Mental Health Center, Inc. and Subsidiary continue efforts to develop internal control policies and procedures over financial activities to ensure that its financial and program data is ready for the financial and single audits on a timely basis. Views of Responsible Officials and Planned Corrective Actions: We agree with this finding and have outsosurced its CFO function to improve the timeliness of financial activities. Additional details can be found in the Organization’s Corrective Action Plan.
Criteria: The Uniform Guidance Compliance Supplement (2 CFR 200.328) and Federal Register requires recipients of the Coronavirus State and Local Fiscal Recovery Funds (ARPA) to submit periodic federal financial and performance reports. Condition: Upon request, the periodic financial reports were not provided for review. The County indicated that they did not file any of the required reports.
Reporting Finding Number: 2022-005 Assistance Listing Number and Title: AL # 14.871 - Section 8 Housing Choice Vouchers/Housing Voucher Cluster Federal Award Identification Number / Year: 2022 Federal Agency: U.S. Department of Housing and Urban Development Compliance Requirement: Reporting Pass-Through Entity: N/A Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR § 200.328 which provides that, unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as applicable, when providing financial and performance reporting information. 24 CFR § 5.801 (d)(1) provides that unaudited financial statements will be required 60 days after the PHA's fiscal year end, and audited financial statements will then be required no later than 9 months after the PHA's fiscal year end, in accordance with the Single Audit Act and 2 CFR part 200, subpart F. In addition, 24 CFR § 5.801 (b)(1) provides that entities to which this subpart is applicable must provide to HUD such financial information as required by HUD prepared in accordance with Generally Accepted Accounting Principles (GAAP). The Authority submitted its audited submission for the year ended December 31, 2021 in the Financial Assessment Sub-system (FASS-PH) on January 30, 2024. This submission was rejected and resubmitted on March 21, 2024. The Authority had received a sixty-day extension until November 30, 2022. This submission was not within the required timeframes or extension. The delays in submissions were due to investigations into fraudulent transactions by the former Executive Director. The failure to timely submit the required financial information reduces the U.S. Department of Housing and Urban Development’s ability to monitor subrecipients. Although the annual financial statements were prepared in accordance with GAAP, a required Statement of Cash Flows was not included. The Authority should continue working with their compiler and auditors to rectify the accounting issues resulting from the actions of the former Executive Director. Once that is completed, the Authority should timely remit the required reports and submit a complete annual financial report prepared in accordance with GAAP.
Reporting Finding Number: 2022-005 Assistance Listing Number and Title: AL # 14.871 - Section 8 Housing Choice Vouchers/Housing Voucher Cluster Federal Award Identification Number / Year: 2022 Federal Agency: U.S. Department of Housing and Urban Development Compliance Requirement: Reporting Pass-Through Entity: N/A Repeat Finding from Prior Audit? No Noncompliance and Material Weakness 2 CFR § 2400.101 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR § 200.328 which provides that, unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as applicable, when providing financial and performance reporting information. 24 CFR § 5.801 (d)(1) provides that unaudited financial statements will be required 60 days after the PHA's fiscal year end, and audited financial statements will then be required no later than 9 months after the PHA's fiscal year end, in accordance with the Single Audit Act and 2 CFR part 200, subpart F. In addition, 24 CFR § 5.801 (b)(1) provides that entities to which this subpart is applicable must provide to HUD such financial information as required by HUD prepared in accordance with Generally Accepted Accounting Principles (GAAP). The Authority submitted its audited submission for the year ended December 31, 2021 in the Financial Assessment Sub-system (FASS-PH) on January 30, 2024. This submission was rejected and resubmitted on March 21, 2024. The Authority had received a sixty-day extension until November 30, 2022. This submission was not within the required timeframes or extension. The delays in submissions were due to investigations into fraudulent transactions by the former Executive Director. The failure to timely submit the required financial information reduces the U.S. Department of Housing and Urban Development’s ability to monitor subrecipients. Although the annual financial statements were prepared in accordance with GAAP, a required Statement of Cash Flows was not included. The Authority should continue working with their compiler and auditors to rectify the accounting issues resulting from the actions of the former Executive Director. Once that is completed, the Authority should timely remit the required reports and submit a complete annual financial report prepared in accordance with GAAP.