FINDING 2024-005 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Reporting Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2024 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context As part of sound management of the federal award, the City was responsible for implementing a system of internal controls that would ensure compliance with the applicable requirements. The City had not properly designed or implemented such a system, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. Recipients are required to submit an initial interim report and quarterly or annually submit Project and Expenditure (P&E) reports to the U.S. Department of the Treasury (Treasury). The reporting periods, as well as the respective due dates are based upon type of recipient and its population, as well as the recipient's allocation amount. Information to be reported includes projects funded, expenditures, and contracts for the appropriate reporting period. The City was classified as a city with a population below 250,000 residents that was allocated less than $10 million in COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (SLFRF). As such, an annual P&E report, covering one calendar year from April 1, 2023 to March 31, 2024, was prepared and submitted by the Clerk-Treasurer to the Treasury by April 30, 2024. The P&E report data to be submitted included, but was not limited to, current period and total cumulative obligations and current period and total cumulative expenditures. We were unable to trace the annual P&E report to the City's records. The errors identified were as follows: Total cumulative obligations were overstated by $1,732,149. Current period obligations were understated by $2,089,238. Current period expenditures and total cumulative expenditures were both overstated by $38,398. In addition, the P&E report required obligations and expenditures to be reported by project. The City completed the report utilizing total amounts for all projects. There were 11 projects appropriated using the SLFRF award. 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: INDIANA STATE BOARD OF ACCOUNTS 23 CITY OF VINCENNES SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (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. . . ." 31 CFR 35.4(c) states in part: "Reporting and requests for other information. During the period of performance, recipients shall provide to the Secretary periodic reports providing detailed accounting of the uses of funds, . . ." Compliance and Reporting Guidance, State and Local Fiscal Recovery Funds, page 13, states in part: ". . . 10. Reporting. All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. . . ." Cause The City officials appropriated the entire SLFRF award in May 2022 and reported the entire award amount as obligated in the P&E reports completed in 2023 and 2024. City officials were not aware that appropriating the funds alone does not constitute obligations of the award. Additionally, correcting adjustments made after the report was submitted partially contributed to the differences noted in expenditures. City officials were also not aware that obligations and expenditures could not be reported in total but should be reported by project. Effect Without a proper system of internal controls in place that operated effectively, the City did not file an accurate annual P&E report as required under the federal award. As such, the City did not accurately report current period obligations, cumulative obligations, current period expenditures, and cumulative expenditures when filing the P&E report for the period April 1, 2023 to March 31, 2024. As a result, material noncompliance occurred and remained undetected. 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. INDIANA STATE BOARD OF ACCOUNTS 24 CITY OF VINCENNES SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that the City's management establish a proper system of internal controls and develop and implement reporting policies and procedures to ensure that all required reports are complete and accurate when submitted. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2 CFR 1000.10 gives regulatory effect to the Department of Treasury for 2 CFR part 200. 2 CFR 200.302 states, in part, the 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 Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 200.302 further states, in part, the financial management system of each non-Federal entity must provide for accurate, current, and complete disclosures of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Additionally, the Ohio Department of Development (ODOD) Water and Wastewater Infrastructure Program Grant Agreement provides in Exhibit II that "Program reports must be submitted on a quarterly basis. Program reports must be submitted by close of business, on the second Friday at the end of each quarter". Due to deficiencies in the Village’s internal controls over reporting, the Village did not submit quarterly program reports for any quarter in 2024. Failure to submit required quarterly program reports could result in the Village not receiving the reimbursements that it is entitled to. The Village should implement internal controls to ensure that reports are submitted by the required deadlines per reporting requirements.
2024-004 Corporation for National and Community Service Federal Financial Assistance Listing #94.012, 22BIICA001 10/1/2022 – 9/30/2025, 23BIACA001 10/1/2023 – 9/30/2026, 23BIFNY001 10/1/2023 – 9/30/2026 Americorps September 11th National Day of Service and Remembrance Grants Reporting Material Weakness in Internal Controls over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 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. 2 CFR Part 170 establishes requirements for recipients’ reporting of information on subawards as required by the Federal Funding Accountability and Transparency Act of 2006 (FFATA). Condition: Reporting of information on subawards as required by the Federal Funding Accountability and Transparency Act of 2006 (FFATA) was not completed for each of the four subrecipients in which pass through funds exceeded $30,000. Cause: There was a misunderstanding with management over reporting requirements surrounding amounts passed through to subrecipients. Effect: Not having a clear understanding of FFATA reporting requirements lead to required information not being reported. Questioned Costs: None reported. Context/Sampling: There was a total of six federal financial reports, of which 2 were selected for testing. There were a total of four FFATA reports, of which 2 were selected for testing. Repeat Finding from Prior Year: Yes, prior year finding 2023-005. Recommendation: We recommend that management review procedures and control processes to ensure they comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.
Federal Program: Crime Victim Assistance – ALN 16.575, National Family Caregiver Support, Title III, Part E – ALN 93.052, Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Heath or Healthcare Crises – ALN 93.391, Hospital Preparedness Program (HPP) Ebola Preparedness and Response Activities – ALN 93.817, Block Grants for Prevention and Treatment of Substance Abuse – ALN 93.959, Non-Profit Security Program – ALN 97.008 Federal Agency: U.S. Department of Justice, U.S Department of Health and Human Services, U.S. Department of Homeland Security Federal Award Year: Various Criteria or Requirement: Per 2 CFR 200.328, The recipient or subrecipient must submit financial reports as required by the Federal award. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Per 2 CFR 200.329, The recipient or subrecipient must submit performance reports as required by the Federal award. Intervals must be no less frequent than annually nor more frequent than quarterly except if specific conditions are applied (See § 200.208). Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. A subrecipient must submit a final performance report to a pass-through entity no later than 90 calendar days after the conclusion of the period of performance. Per the 2024 Compliance Supplement, non-federal entities may be required to submit special reports as required by the terms and conditions of the federal award. Per 2 CFR 200.303, the non-federal entity must establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition found, including facts that support the deficiency identified in the finding and information to provide proper perspective for judging the prevalence and consequences of the finding: Of 20 financial reports tested, 9 were either not submitted timely or documentation was not available to substantiate when the report was submitted. Of 23 performance reports tested, 12 were either not submitted timely or documentation was not available to substantiate when the report was submitted. Of 9 special reports tested, 6 were either not submitted timely or documentation was not available to substantiate when the report was submitted. Cause and possible asserted effect: The Health System does not have an effective process and control to ensure timely submission of required reports per the terms and conditions of federal awards and applicable regulations and retainage of evidence of control operation (i.e. evidence of report submission). Identification of questioned costs and how they were computed: None Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample. Identification of whether the audit finding is a repeat of a finding in the immediately prior audit and if so, the applicable prior year finding number: No. This finding was not a finding in the immediate prior year audit. Recommendations: We recommend that the Health System review and enhance its current procedures to ensure that all required reporting applicable to federal awards is accurately identified, submission deadlines are met, and documentation of submissions is properly retained. Views of responsible officals: Management acknowledges the audit finding regarding timely submission of reports and retaining documentation of submissions. We will implement a new combined monitoring and record retention internal control process for financial, performance, and special reporting requirements, to ensure timely submission and retention of supporting documentation for required sponsor reporting. This process will be implemented by December 31, 2025.
FINDING 2024-004 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 Numbers and Years (or Other Identifying Numbers): 92-02, 92-03, 92-04, 92-05 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context As part of sound management of the federal award, the City was responsible for implementing a system of internal controls that would ensure compliance with the applicable requirements. The City had not properly designed or implemented such a system, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The City was required to submit two annual data reports to the Department of Agriculture. The Statement of Budget, Income and Equity (Form RD 442-2) report data to be submitted included, but was not limited to, current income and expenditures and budgeted amounts. The Balance Sheet (Form RD 442-3) report data to be submitted included, but was not limited to, current year assets and liabilities. Per the USDA Rural Utilities Service Borrower's Guide, both reports also required inclusion of comparative information for the prior year. Both reports were selected for testing. We were unable to trace either report to the City's records, nor could we verify the accuracy and completeness of either report. The following errors were identified: • The Form RD 442-2, which covered calendar year 2023, reported total income and expenses of $3,792,018 and $1,615,582, respectively. However, the City's ledger for the same period had total income and expenses of $3,985,851 and $3,740,788, respectively. This resulted in net income being overstated by $2,319,039. Additionally, only one amount was reported as comparative data for prior year activity. We were unable to determine what this amount represented and were unable to verify it to the prior period report or to the City's records. • The Form RD 442-3, which covered calendar year 2023, reported total assets and liabilities of $18,229,653 and $10,503,419, respectively. However, the City's records for the same period had total assets and liabilities of $39,216,648 and $12,758498, respectively. Additionally, no comparative amounts from the prior year were reported. 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. . . ." 7 CFR 1780.47 states in part: "(a) Borrowers are required to provide RUS an annual audit or financial statements. . . . (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.) • The Form RD 442-3, which covered calendar year 2023, reported total assets and liabilities of $18,229,653 and $10,503,419, respectively. However, the City's records for the same period had total assets and liabilities of $39,216,648 and $12,758498, respectively. Additionally, no comparative amounts from the prior year were reported. 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. . . ." 7 CFR 1780.47 states in part: "(a) Borrowers are required to provide RUS an annual audit or financial statements. . . . (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.)• The Form RD 442-3, which covered calendar year 2023, reported total assets and liabilities of $18,229,653 and $10,503,419, respectively. However, the City's records for the same period had total assets and liabilities of $39,216,648 and $12,758498, respectively. Additionally, no comparative amounts from the prior year were reported. 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. . . ." 7 CFR 1780.47 states in part: "(a) Borrowers are required to provide RUS an annual audit or financial statements. . . . (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. . . ." Cause The Clerk-Treasurer had served in the position for less than two years when the reports for 2024 were due and was inexperienced with the reporting requirements of the award. As a result, the Clerk-Treasurer did not properly prepare the reports. Additionally, the Clerk-Treasurer was solely responsible for preparing and submitting the reports with no oversight, review, or approval process that would have allowed for prevention, or detection and correction, of the noncompliance. Effect Without a proper system of internal controls in place that operated effectively, the City did not file an accurate and complete report for either annual report required under the federal award. As a result, material noncompliance occurred and remained undetected. By not reporting the comparative data, all information needed to determine the financial status of the City was not readily available. 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 the City's management establish a proper system of internal controls and develop and implement reporting policies and procedures to ensure that all required reports are filed timely, accurately, and contain all the required information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2024-006 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Reporting Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2024 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Condition and Context As part of sound management of the federal award, the City was responsible for implementing a system of internal controls that would ensure compliance with the applicable requirements. The City had not properly designed or implemented such a system, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The City was required to submit an annual Project and Expenditure (P&E) report to the U.S. Department of the Treasury. The P&E report data to be submitted included, but was not limited to, current period and total cumulative obligations and current period and total cumulative expenditures. We were unable to trace the annual P&E report to the City's records. The errors identified were as follows: • Total cumulative obligations were overstated by $23,337. • Total cumulative expenditures were understated by $171,136. • Current period expenditures were understated by $163,789. 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. . . ." 31 CFR 35.4(c) states in part: "Reporting and requests for other information. During the period of performance, recipients shall provide to the Secretary periodic reports providing detailed accounting of the uses of funds, . . ." Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guidance, page 10, states in part: ". . . 10. Reporting. All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. . . ." Cause The Clerk-Treasurer had served in the position for two years when the report for 2024 was due and was inexperienced with the reporting requirements of the award. As a result, the Clerk-Treasurer did not properly prepare the report. Additionally, the Clerk-Treasurer was solely responsible for preparing and submitting the report with no oversight, review, or approval process that would have allowed for prevention, or detection and correction, of the noncompliance. Effect Without a proper system of internal controls in place that operated effectively, the City did not file an accurate annual P&E report as required under the federal award. As a result, material noncompliance occurred and remained undetected. 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 the City's management establish a proper system of internal controls and develop and implement reporting policies and procedures to ensure that all required reports are complete and accurate when submitted. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2024-002 Improve Controls Over Reporting Federal Program Information Federal Agency: Department of Health and Human Services Award Name(s): Child Care and Development Block Grant Assistance Listing Number(s): 93.575 Award Year: 2022 Compliance Requirement: Reporting Type of Finding Compliance Internal Control over Compliance – Significant Deficiency Criteria or Specific Requirement 2 CFR 200.329 requires non-Federal entities to submit performance reports as required by the Federal awarding agency or pass-through entity in a timely manner as specified in the terms and conditions of the award. Program guidance for the Child Care and Development Block Grant requires that quarterly project progress reports be submitted by specified deadlines unless a formal extension is granted by the awarding agency. SECTION III - FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS (CONTINUED) 2024-002 Improve Controls Over Reporting (Continued) Condition and Context During our audit, we tested a sample of two quarterly project progress reports under the Child Care and Development Block Grant. The Organization submitted both quarterly project progress reports after the required submission deadlines. There was no documentation of a formal extension granted by the awarding agency. Cause The Organization’s internal controls did not ensure timely preparation and submission of required performance reports in accordance with federal program requirements, or ensure that an extension was requested. Effect or Potential Effect Late submission of required reports increases the risk of noncompliance with federal award requirements and may negatively affect the Organization’s ability to demonstrate progress on program objectives. No questioned costs are reported as the requirement is procedural in nature. Recommendation The Organization should implement procedures to ensure that all required performance reports are submitted timely in accordance with federal program requirements or have policies in place regarding formal documentation and approval of extension requests. Views of Responsible Official Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.
2 CFR § 1000.10 gives regulatory effect to Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200 for the Department of Treasury. 2 CFR 200.329(c)(1) states that non-Federal entities 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. Reports submitted quarterly must be due no later than 30 calendar days after the reporting period. 31 CFR 35.4(c) requires recipients, in part, during the period of performance, to provide the Secretary of the U.S. Department of Treasury periodic reports providing detailed accounting of the uses of funds, modifications to a State or Territory's tax revenue sources, and such other information as the Secretary may require for the administration of this section. The U.S. Department of Treasury provided supplementary information on reporting requirements in its interim final rule for State and Local Fiscal Recovery Funds for 31 CFR Part 35 and provided further guidance in its Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guide. The County submitted the required SLFRF Project and Expenditure Reports; however possibly due to the failure of an existing control(s), the expenditures reported on four out of the four (one hundred percent) did not agree to the accounting records with differences ranging from $104,513 to $602,647. The County submitted only three of the four (seventy-five percent) of the SLFRF Project and Expenditure Reports during 2024 to the Ohio Department of Development. Reporting errors could adversely affect future grant awards. An additional control(s) and/or additional procedure(s) should be implemented to help ensure accuracy of the reports.
Criteria or specific requirement: 2 CFR Section 200.329(b) requires the entity to submit performance reports with the applicable information no less than quarterly. Condition: 1 out of 2 quarterly reports tested was not submitted. Questioned costs: Unknown. Context: During our test of performance reporting requirements, we noted the Organization did not file one of the quarterly reports. Cause: Policies and procedures are not in place to ensure reports are submitted. Effect: Required performance report not submitted. Repeat Finding: No. Recommendation: We recommend the Organization create and or update policies and procedures to ensure all required reports are submitted timely and accurately. Views of responsible officials: There is no disagreement with the audit finding.
Finding Number: 2024-004 Assistance Listing Number and Title: AL # 14.251 Economic Development Initiative, Community Project Funding, and Miscellaneous Grants Federal Award Identification Number / Year: B-22-CP-OH-0726 Federal Agency: U.S. Department Of Housing And Urban Development Compliance Requirement: Reporting Pass-Through Entity: N/A Repeat Finding from Prior Audit? No Prior Audit Finding Number: N/A Noncompliance and Material Weakness 2 CFR 2400 gives regulatory effect to the Department of Housing and Urban Development for 2 CFR 200.329 which provides the recipient and subrecipient are responsible for the oversight of the Federal award. The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity. Grant Agreement No. B-22-CP-OH-0726 Article VI Program-Specific Reporting Requirement states that in addition to the general reporting requirements that apply under provisions of this Agreement, the following program-specific reporting requirements apply to the grantee: A. The Grantee must submit a performance report in DRGR on a semi-annual basis and must include a completed Federal financial report as an attachment to each performance report in DRGR. Performance reports shall consist of a narrative of work accomplished during the reporting period. During the Period of Performance, the Grantee must submit these reports in DRGR no later than 30 calendar days after the end of the 6-month reporting period. The first of these reporting periods begins on the first of January or June (whichever occurs first) after the date this Grant Agreement is signed by HUD. B. The performance report must contain the information required for reporting program performance under 2 CFR 200.329(c)(2) and (d), including a comparison of actual accomplishments to the objectives of the Project as described in Article III, section A of this Grant Agreement, the reasons why established goals were not met, if appropriate, and additional pertinent information including, when appropriate, analysis and explanation of cost overruns or high unit costs. • The County submitted a semi-annual performance report for the time period ending June 30, 2024 for the Economic Development Initiative AL# 14.251 B-22-CP-OH-0726 indicating total funds expended of $0. The County accounting records for the time period ending June 30, 2024 had expenditures of $537,015, resulting in a variance of $537,015. • The County submitted a semi-annual performance report for the time period ending December 31, 2024 for the Economic Development Initiative AL# 14.251 B-22-CP-OH-0726 indicating current expenditures of $0. The County accounting records for the time period ending December 31, 2024 had expenditures of $2,129,368, resulting in a variance of $2,129,368. The failure to submit accurate amounts was due to insufficient controls and could result in action taken by the grantor. The County anticipates contacting HUD after the end of the federal shutdown to amend these reporting errors. Additional controls should be implemented to help ensure accuracy of the reports.
Finding Number: 2024-003 Assistance Listing Number and Title: AL # 21.027 Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number / Year: 2022-AR-CVI-1159 Federal Agency: U.S. Department Of Treasury Compliance Requirement: Reporting Pass-Through Entity: Ohio Department of Public Safety Repeat Finding from Prior Audit? No Prior Audit Finding Number: N/A Noncompliance and Material Weakness 2 CFR § 1000.10 gives regulatory effect to Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200 for the Department of Treasury. 2 CFR 200.329 provides the recipient and subrecipient are responsible for the oversight of the Federal award. The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity. The Office of Criminal Justice Service (OCJS) Standard Subgrant Conditions Handbook provides all OCJS projects are required to submit Quarterly Subgrant Reports. This report must show actual expenditures, describe progress towards achieving objectives, and include supporting documentation (such as purchase orders, vouchers, invoices, payroll allocation reports, payroll summaries, time sheets, etc.) for expenditures. The reports shall be submitted no later than the last day of the month following the calendar quarter end. A report must be submitted every quarter, even when there has been zero expenditure or when a payment is not being requested. • The County submitted the quarterly report for the quarter ending March 31, 2024 for the COVID-19: Coronavirus State and Local Fiscal Recovery Funds AL# 21.027 Washington County Violence Interruption Project 2022ARCVI1159 with current expenditures of $63,918. Washington County accounting records for quarter ending March 31, 2024 had expenditures of $58,069, resulting in a variance of $5,849. • The County submitted the quarterly report for the quarter ending June 30, 2024 for the COVID-19: Coronavirus State and Local Fiscal Recovery Funds AL# 21.027 Washington County Violence Interruption Project 2022ARCVI1159 with current expenditures of $0. Washington County accounting records for quarter ending June 30, 2024 had expenditures of $30,140, resulting in a variance of $30,140. • The County submitted the quarterly report for the quarter ending September 30, 2024 for the COVID-19: Coronavirus State and Local Fiscal Recovery Funds AL# 21.027 Washington County Violence Interruption Project 2022ARCVI1159 with current expenditures of $242,219. Washington County accounting records for quarter ending September 30, 2024 had expenditures of $41,604, resulting in a variance of $200,615. • The County submitted the quarterly report for the quarter ending December 31, 2024 for the COVID-19: Coronavirus State and Local Fiscal Recovery Funds AL# 21.027 Washington County Violence Interruption Project 2022ARCVI1159 with current expenditures of $37,086. Washington County accounting records for Quarter ending December 31, 2024 had expenditures of $23,653, resulting in a variance of $13,433. The failure to submit accurate amounts was due to insufficient controls and could result in action taken by the pass-through entity. Additional controls should be implemented to help ensure accuracy of the reports.
2 CFR 200.329(c)(1) states that non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, using a form or format authorized by the Office of Budget and Management (OBM). Recipients must use the standard financial reporting forms or such other forms as may be authorized by OMB (approval is indicated by an OMB paperwork control number on the form) when reporting to the Federal awarding agency. Each recipient must report program outlays and program income on a cash or accrual basis, as prescribed by the Federal awarding agency. Entities are required to submit a Project and Expenditure Report annually. Reported expenditures on the draw down reports for 2024 did not agree with supporting invoices paid by the Village. The Village, on two occasions, received monies prior to the bills being paid. Therefore, draws were being completed prior to the expenditures happening. Additionally, the Project and Expenditure report for 2024 which was due by April 30, 2025, was not submitted. By not properly filing the required reports, the Village is in noncompliance with the requirements set forth by the U.S. Department of Treasury. This could result in the Treasury not fully being aware of how the Village is utilizing the funding in determining if the Village is following other requirements and using the funding properly. The Village should add additional procedures or controls to ensure all components of reporting federal expenditures are accurately reported.
2 CFR § 3002 gives regulatory effect to the Department of Homeland Security for 2 C.F.R. § 200.329(c) which states, in part, reports submitted annually by the non-Federal entity and/or pass-through entity must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. The final performance report submitted by the non-Federal entity and/or pass through entity must be due no later than 120 calendar days after the period of performance end date. Due to deficiencies in policies and procedures over reporting compliance we noted the following: • The required Programmatic Performance Report (PPR) for the period of July 1, 2024 through December 31, 2024 was not submitted on the FEMA Go website; • The required Federal Financial Report (SF-425) for the period of January 1, 2024 through June 30, 2024 was not submitted on the FEMA Go website; and • Two of the three required Federal Financial Reports (SF-425) were submitted after the due date (one three days late, one over four months late). Failure to prepare and submit federal grant reports could result in the City not receiving the reimbursements that it is entitled to. The City should implement policies and procedures to help ensure that federal grant reports are completed and submitted by the required date.
2 CFR 1000.10 gives regulatory effect to Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards set forth at 2 CFR Part 200 for the Department of Treasury. 2 CFR 200.329(c)(1) states, that non-Federal entities 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. Reports submitted quarterly must be due no later than 30 calendar days after the reporting period. 31 CFR § 35.4(c) requires, in part, recipients, during the period of performance, to provide the Secretary of the U.S. Department of Treasury (the Treasury) periodic reports providing detailed accounting of the uses of funds, modifications to a State or Territory's tax revenue sources, and such other information as the Secretary may require for the administration of this section. For the Coronavirus State and Local Fiscal Recovery Funds, the Treasury issued the Final Rule, which clarified deadlines relating to Compliance and Reporting. The Treasury’s Compliance and Reporting guidance states that metropolitan cities and counties with a population below 250,000 residents that are allocated less than $10 million in State and Local Fiscal Recovery funding and non-entitlement units that are allocated less than $10 million in State and Local Fiscal Recovery funding are required to submit annual Project and Expenditure Reports. It further states annual reports will cover one calendar year and must be submitted to the Treasury by April 30th. The City’s annual Project and Expenditure Report was required to be submitted to the Treasury by April 30, 2024, however, was not submitted until June 20, 2024. The City’s failure to submit the required Project and Expenditure Report by the required date was due to lack of internal control over reporting for the program. Failure to have proper controls in place to ensure timely and accurate submission of Project and Expenditure Reports could result in the Treasury taking action against the City for failure to comply with programmatic requirements. The City should implement policies and procedures and have controls in place to ensure the Project and Expenditure Report is accurate and filed by the required due date to ensure compliance with their grantor's requirements.
2 CFR § 1000.10 gives regulatory effect to Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200 for the Department of Treasury. 2 CFR 200.329(c)(1) states that non-Federal entities 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. 31 CFR 35.4(c) requires recipients, in part, during the period of performance, to provide the Secretary of the U.S. Department of Treasury periodic reports providing detailed accounting of the uses of funds, modifications to a State or Territory's tax revenue sources, and such other information as the Secretary may require for the administration of this section. The U.S. Department of Treasury provided supplementary information on reporting requirements in its interim final rule for State and Local Fiscal Recovery Funds for 31 CFR Part 35 and provided further guidance in its Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guide. The City submitted the required SLFRF Program Reports; however, possibly due to the failure of an existing Control(s), only two out of three (sixty-seven percent) were submitted timely. Reporting errors could adversely affect future grant awards. An additional control(s) and/or additional procedure(s) should be implemented to help ensure accuracy of the reports and that reports are submitted timely as required.
2 CFR 1000.10 gives regulatory effect to the Department of Treasury for 2 CFR 200.329 which states the recipient is responsible for oversight of the Federal Award. The recipient must monitor its activities under Federal Awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient must cover each program, function or activity. Compliance and Reporting Guidance for the program states that Project and Expenditure Reports are to be submitted by April 30th, 2022 and then annually thereafter. Project and Expenditures Reports are also to include current and cumulative obligations and current and cumulative expenditures. The following errors were noted in the Project and Expense Report for the period April 1, 2024 through March 31, 2025: Gallia County ARPA Project Identification Number 2023-01 current period expenditures and obligations were overstated $207,622 and cumulative expenditures and obligations were overstated $9,258. Gallia County ARPA Project Identification Number 2024-1 current period expenditures were overstated $259.489 and cumulative expenditures and obligations were understated $1,149,079. Gallia County ARPA Project Identification Number 2024-01 current and cumulative expenditures were understated $502,560.81, current period obligations were overstated $133,176, and cumulative obligations were understated $508,174 in an attempt to compensate for prior period errors. Gallia County Project Identification Number 2021-03 current expenditures and current obligations were overstated $43,254. Gallia County Project Identification Number 2021-09 current expenditures and current obligations were overstated $98,131 and cumulative expenditures and cumulative obligations were overstated $447,793. Gallia County Project Identification Number 2022-05 current expenditures and obligations were overstated $29,909. Gallia County Project Identification Number 2022-06 current expenditures were overstated $417,885 and cumulative expenditures and cumulative obligations were overstated $253,499. Gallia County Project Identification Number 2022-07 current expenditures were overstated $7,590 and cumulative expenditures and cumulative obligations were overstated $245,909. Gallia County Project Identification Number 2022-08 current expenditures were overstated $14,264 and cumulative expenditures and cumulative obligations were overstated $231,645. Gallia County Project Identification Number 2022-00 current expenditures were overstated $519 and cumulative expenditures and cumulative obligations were overstated $231,645. Gallia County Project Identification Number 2022-01 current expenditures were overstated $5,708 and cumulative expenditures and obligations were overstated $225,865. Gallia County Project Identification Number 2022-10 current expenditures and current obligations were overstated $214,189 and cumulative expenditures and cumulative obligations were overstated $11,676. Many of the above errors were a result of trying to fix past reporting errors and reporting prior period expenditures as current period expenditures. The County should ensure they are following all federal requirements and reporting amounts supported by the underlying County ledgers.
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 states, in part, the financial management system of each non-Federal entity must provide for 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. 2 CFR 200.329(c)(1) states that non-Federal entities 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. Reports submitted quarterly must be due no later than 30 calendar days after the reporting period. 31 CFR 35.4(c) requires recipients, in part, during the period of performance, to provide the Secretary of the U.S. Department of Treasury periodic reports providing detailed accounting of the uses of funds, modifications to a State or Territory's tax revenue sources, and such other information as the Secretary may require for the administration of this section. The U.S. Department of Treasury provided supplementary information in its 2021 interim final rule on reporting requirements for State and Local Fiscal Recovery Funds for 31 CFR Part 35 and provided further guidance in its Project and Expenditure Report User Guide for State and Local Fiscal Recovery Funds. The 2021 interim rule supplementary information, part VIII states that counties will be required to submit quarterly Project and Expenditure reports through the end of the award period on December 31, 2026. The Department of Treasury’s Project and Expenditure Report User Guide provides, in part, that counties with a population that exceeds 250,000 residents must submit a Project and Expenditure Report by January 31, 2022 and then the last day of the month after the end of each quarter thereafter. The County did not have proper internal controls in place to ensure the timely and accurate submission of the Project and Expenditure Reports. During testing of Project and Expenditure Reports for the COVID-19 Coronavirus State and Local Fiscal Recovery Funds (AL #21.027), we noted that: • The County did not submit the Project and Expenditure Reports for the second and fourth quarters by the required deadlines of July 31, 2024 and January 31, 2025, respectively. • On the first quarter Project and Expenditure Report, the County understated current period expenditures by $1,041,688, understated cumulative expenditures by $11,564,350, and understated cumulative obligations by $1,407,879. Similarly, on the third quarter Project and Expenditure Report, the County understated current period expenditures by $385.732, understated the cumulative expenditures by $13,169,950, and understated cumulative obligations by $1,407,879. 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 County for failure to comply with programmatic requirements. The County should implement and have controls in place to ensure the quarterly Project and Expenditure Reports are accurate and filed by the required due dates.
ALN 14.251 Finding #2024‐009 Untimely or Incomplete Performance and Financial Reporting Repeat Finding: No Condition: The Organization did not submit required federal performance and financial reports in accordance with federal deadlines. Specifically, several required reports were either not completed, or were submitted after the required due dates set forth in the grant agreements. In some instances, supporting documentation was incomplete or insufficient. Criteria: Per 2 CFR 200.328 and 2 CFR 200.329, recipients of federal awards are required to submit performance and financial reports as required by the awarding agency. Reports must be accurate, complete, and submitted timely, in accordance with the terms and conditions of the award. Timely reporting allows federal agencies to monitor progress and ensure funds are used for authorized purposes. Cause: The Organization did not have adequate internal controls to track reporting due dates or ensure that reports were completed, reviewed, and submitted on time. Effect: Failure to submit complete and timely reports represents noncompliance with Uniform Guidance requirements and the terms of the federal awards and increases risk relating to the ability of the federal oversight agency to monitor the grant. Questioned Costs: None noted. Perspective Information: Performance and financial reports for each semi‐annual period were not submitted timely. Recommendation: We recommend that the Organization implement internal controls to ensure all required federal reports are completed accurately and submitted on time. Reporting Views of Responsible Officials: The Organization agrees with the finding. Procedures are being implemented to ensure all reports are provided to the Organization to ensure compliance with the federal grants.
2 CFR § 200.329(c)(1) requires the recipient or subrecipient must submit performance reports as required by the Federal award. Ohio Department of Development Water and Wastewater Infrastructure Program Grant Agreement, Exhibit II, Reporting indicates Grantee shall provide the documents listed below by the date(s) specified herein or to be determined by the Grantor. Grantor shall provide a format for these documents and shall instruct the Grantee in the proper completion of such documents. 2. Program Reports: Program reports must be submitted on a quarterly basis. Program reports must be submitted by close of business, on the second Friday at the end of each quarter. Program reports must include the following information: a. Narrative summary of use of funds during the reporting period b. Narrative describing promoting equitable outcomes. Describe efforts used to promote equitable outcomes, including how projects were implemented with equity in mind. c. Narrative describing community engagement d. Labor Practices: Describe workforce practices on projects implemented. How is the project using strong labor standards to promote effective and efficient delivery of high-quality infrastructure e. Project Construction Start Date (if applicable) f. Project Operations date g. National Pollutant Discharge Elimination System (NPDES} Permit Number (if applicable} h. Public Water System (PWS) ID Number (if applicable) i. Information on Matching funds utilized during the reporting period (i.e., source, amount and uses) 3. Final Report: A final project report must be submitted 15 days after the end of this agreement. The final report must include the following information: a. Number of new households who have access to public water or centralized sewer system b. Number of public and private service lines replaced c. Number of home sewage treatment systems replaced The Village completed their waterline and household lead line replacement project during the audit period, spending all $1,412,472 of the grant funds during 2024. However, the Village did not complete quarterly program reports during the year, nor the Final Report when the project was completed. We have modified our opinion accordingly. By not submitting the required reports as required by the grant agreement, the Village could adversely affect future grant awards. The Village should develop controls and procedures to help ensure the reports are filed with the Ohio Department of Development as required by 2 CFR § 200.329(c)(1) and the grant agreement.
Coronavirus State and Local Fiscal Recovery Funds – Assistance Lising No. 21.027 U.S Department of Treasury Oklahoma State Department of Health Criteria or Specific Requirement – Reporting (2 CFR 200.329) Condition – The Organization’s internal controls over compliance were not able to ensure progress reporting required to be submitted to the pass-through entity was completed timely. Cause – The Organization does not have internal controls over compliance in place to ensure all grant reporting requirements are satisfied timely. Effect or potential effect – The Organization did not submit the required quarterly progress reports in a timely manner. Questioned costs – None Context – The Organization is required to submit quarterly progress reports to the pass-through entity in a timely manner. Identification as a repeat finding, if applicable – No. Recommendation – The Organization should consider implementing a grant reporting calendar for all grants with reporting requirements.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
Coronavirus State and Local Fiscal Recovery Funds – Assistance Lising No. 21.027 U.S Department of Treasury Oklahoma State Department of Health Criteria or Specific Requirement – Reporting (2 CFR 200.329) Condition – The Organization’s internal controls over compliance were not able to ensure progress reporting required to be submitted to the pass-through entity was completed timely. Cause – The Organization does not have internal controls over compliance in place to ensure all grant reporting requirements are satisfied timely. Effect or potential effect – The Organization did not submit the required quarterly progress reports in a timely manner. Questioned costs – None Context – The Organization is required to submit quarterly progress reports to the pass-through entity in a timely manner. Identification as a repeat finding, if applicable – No. Recommendation – The Organization should consider implementing a grant reporting calendar for all grants with reporting requirements.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Reporting (Significant Deficiency and Noncompliance) Information on the federal program: U.S. Department of the Homeland Security, Assistance listing # 97.044 Assistance to Firefighters Criteria: CFR 200.329c requires that reports submitted quarterly or semiannually must be filed no later than 30 calendar days after the reporting period. Condition: We examined the two semiannual Programmatic Performance reports and the semiannual SF425 financial report required to be submitted during the City’s fiscal year. Two of these were not filed within 30 days of specified reporting period as required. Cause: The reports not submitted timely were due July 30. The City’s controls around reporting focus on fiscal and calendar year end. The calendar-year semiannual reporting period is not in the City’s normal reporting schedule and therefore was not addressed through the controls in place. Both reports were filed within 16 days of the due date. Effect: The City did not timely fulfill all the related reporting requirements. Repeat Finding: Yes. Questioned Costs: None reported. Recommendation: We recommend the City strengthen its policies and procedures surrounding grant reporting to include (at inception of each award) documentation of a schedule of reporting requirements, review, and approvals to ensure compliance and documentation of that compliance is retained to support applicable requirements. Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan included at the end of the report.
2024-002 U.S. Department of Treasury, Federal Financial Assistance Listing #21.027, COVID-19 – Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) Matching, Level of Effort and Earmarking; Reporting Significant Deficiency in Internal Control over Compliance Criteria: Recipients of CSLFRF can calculate lost revenue for the years 2020, 2021, 2022, and 2023 based on the formula provided in the 2022 Final Rule to determine the amount of CSLFRF funds that can be used for the “provision of government services”. In calculating revenue loss, recipients can choose whether to use calendar or fiscal year dates but must be consistent throughout the period of performance. If calculating revenue loss, recipients must provide auditors with evidence supporting their revenue loss calculation. Non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB (2 CFR section 200.329). Condition: During the testing over Earmarking, it was noted the County was not able to completely support the amounts used in the calculation. Further, there was no evidence of review of the calculation. Cause: The County’s controls were not sufficient to ensure someone other than the preparer of the revenue loss calculation reviewed the calculation prior to its submission on the County’s quarterly reports. Effect: The revenue loss number calculated by the County was incorrect. This incorrect number was reported to the Treasury as part of the County’s quarterly reporting requirement. Questioned Costs: None reported. Context/Sampling: Sampling was not used for the Earmarking compliance test as there was only 1 revenue loss calculation. A statistical sample of 2 reports were selected for testing out of a total population of 4. Repeat Finding from Prior Year(s): No Recommendation: Management should review the revenue loss calculation to ensure it is appropriately supported by underlying documentation. For all future reports submitted to the Treasury, the recalculated revenue loss amount should be used. Views of Responsible Officials: The County agrees with the auditor’s findings
Finding 2024-001: Preparation of Schedule of Expenditures of Federal Awards (SEFA) Program Name: Multiple federal programs Criteria 1. The code of federal regulations – 2 CFR 200.302 Financial management requires that: (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 funds. All recipient and subrecipient 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 the terms and conditions; and tracking expenditures to establish that funds have been used in accordance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) The recipient’s and subrecipient’s financial management system must provide for the following: (1) Identification 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, year the Federal award was issued, and name of the Federal agency or pass-through entity. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in § 200.328 and § 200.329. When a Federal agency or pass-through entity requires reporting on an accrual basis from a recipient or subrecipient that maintains its records other than on an accrual basis, the recipient or subrecipient must not be required to establish an accrual accounting system. This recipient or subrecipient may develop accrual data for its reports based on an analysis of the documentation on hand. 2. The code of federal regulations – 2 CFR 200.303 Internal controls requires that recipients and subrecipients must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). (b) Comply with the U.S. Constitution, Federal statutes, regulations, and the terms and conditions of the Federal award. (c) Evaluate and monitor the recipient’s or subrecipient’s compliance with statutes, regulations, and the terms and conditions of Federal awards. (d) Take prompt action when instances of noncompliance are identified. Condition The following exceptions to the criteria were observed during the performance of the audit procedures: 1. After the completion of internal review and approval process that Amtrak has established for SEFA preparation and review, we have received multiple updated versions of the schedule with changes to FY24 expenditure amounts for three Assistance Listings included on the SEFA. Total expenditures increased by $80.2 million from version 1 to the final version received. 2. The starting point of the SEFA preparation for the current year was not the audited FY23 SEFA submitted to Federal Audit Clearinghouse, as we have identified that Amtrak subsequently made changes to the FY23 internal SEFA document without reconciling the changes to the audited FY23 SEFA, which resulted in the total cumulative expenditures as of 9/30/2023 to be updated and as such impacting the FY24 expenditures for the respective federal programs. One of the adjustments related to the Hudson Yards Concrete Casing project (HYCC-3) which initially incorrectly recorded $25.0 million of prepaid expenditures. 3. As Assistance Listing #20.314 has been obligated as of 9/27/2024, Amtrak has recorded expenditures related to the HYCC-3 project under this program for the established pre-award period, which dated from January 30, 2023 as part of the FY24 expenditures. Previously, a portion of the total expenditures was included within the FY23 SEFA under Assistance Listing #20.315, for the total amount of $15.6 million. This amount was not adjusted out of the cumulative expenditures for Assistance Listing #20.315 until 2025. Consequently, these expenditures were listed both within the FY23 SEFA under Assistance Listing #20.315 and under the FY24 SEFA as Assistance Listing #20.314 expenditures. 4. As part of SEFA preparation as it relates to allocation of operating expenditures across multiple funding sources, certain projects were incorrectly mapped to annual grants funding source, which resulted in approximately $0.3 million of operating expenses to be included within Assistance Listing #20.315 that were also reported under Assistance Listing #97.075. Cause Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not operating in a manner that would timely identify the conditions noted. Additionally, Amtrak’s controls around allocation of federal funding to project codes were not designed in a manner that would timely identify the conditions noted. In reviewing management’s controls around the SEFA preparation, the design of key controls identified by management does not include an overarching review of the SEFA and reconciliation of what’s been reported on the SEFA from individual projects’ standpoint when such projects have multiple assistance listings as funding sources. We also noted that there was not a specific control that ensures timely updates of Work Breakdown Structure (WBS) funding assignments and allocations when there is a change such as a new grant agreement signed. Effect Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not designed in such a manner that would timely identify the conditions noted, which resulted in several versions of the SEFA that were erroneous and inclusion of expenditures that were double counted within the SEFA. This puts Amtrak at greater risk of non-compliance with its grant agreements with respect to questioned costs and an inaccurate SEFA. Questioned Costs None. Context The SEFA, as originally provided, had exceptions as described in the Condition section above noted for matters 1 and 2 in the Criteria section above, indicating that certain internal controls were not functioning as designed and others were not designed effectively. Identification as a Repeat Finding Not a repeat finding. Recommendation We recommend Amtrak to strengthen the SEFA oversight process to ensure appropriate preparation and review of the SEFA to validate its accuracy, including reconciliation with prior year audited SEFA. This should include having one reviewer take overall responsibility for the completeness and accuracy of the final submitted SEFA. This robust review process should include appropriate procedures to confirm accuracy of the SEFA, which may include a protocol where representatives from various groups (both discretionary and non-discretionary federal programs) work collaboratively to review the SEFA and underlying details of expenditures, to ensure all the adjustments have been properly reflected as well as any projects that might have multiple fund sources are identified timely and reviewed for appropriate inclusion within the SEFA. Additionally, Amtrak should establish a process where any modifications of WBS funding assignments and allocations are updated in a timely manner. Views of Responsible Officials Amtrak recognizes the need to improve the preparation and review of the SEFA. The company has documented the steps for preparing and reviewing the SEFA within its process narrative. The company will update the narrative to address the preparation and review issues that led to the multiple versions of the SEFA being provided during the audit. The company will review and update the Grants Management Compliance Narrative and controls to improve timing of updates for modifications of WBS funding assignments. The company is in the process of updating the SEFA preparation documentation for FY2025, which will be used at the end of the year. The review procedures and controls are being enhanced to include a checklist to improve the review.
Finding 2024-001: Preparation of Schedule of Expenditures of Federal Awards (SEFA) Program Name: Multiple federal programs Criteria 1. The code of federal regulations – 2 CFR 200.302 Financial management requires that: (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 funds. All recipient and subrecipient 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 the terms and conditions; and tracking expenditures to establish that funds have been used in accordance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) The recipient’s and subrecipient’s financial management system must provide for the following: (1) Identification 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, year the Federal award was issued, and name of the Federal agency or pass-through entity. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in § 200.328 and § 200.329. When a Federal agency or pass-through entity requires reporting on an accrual basis from a recipient or subrecipient that maintains its records other than on an accrual basis, the recipient or subrecipient must not be required to establish an accrual accounting system. This recipient or subrecipient may develop accrual data for its reports based on an analysis of the documentation on hand. 2. The code of federal regulations – 2 CFR 200.303 Internal controls requires that recipients and subrecipients must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). (b) Comply with the U.S. Constitution, Federal statutes, regulations, and the terms and conditions of the Federal award. (c) Evaluate and monitor the recipient’s or subrecipient’s compliance with statutes, regulations, and the terms and conditions of Federal awards. (d) Take prompt action when instances of noncompliance are identified. Condition The following exceptions to the criteria were observed during the performance of the audit procedures: 1. After the completion of internal review and approval process that Amtrak has established for SEFA preparation and review, we have received multiple updated versions of the schedule with changes to FY24 expenditure amounts for three Assistance Listings included on the SEFA. Total expenditures increased by $80.2 million from version 1 to the final version received. 2. The starting point of the SEFA preparation for the current year was not the audited FY23 SEFA submitted to Federal Audit Clearinghouse, as we have identified that Amtrak subsequently made changes to the FY23 internal SEFA document without reconciling the changes to the audited FY23 SEFA, which resulted in the total cumulative expenditures as of 9/30/2023 to be updated and as such impacting the FY24 expenditures for the respective federal programs. One of the adjustments related to the Hudson Yards Concrete Casing project (HYCC-3) which initially incorrectly recorded $25.0 million of prepaid expenditures. 3. As Assistance Listing #20.314 has been obligated as of 9/27/2024, Amtrak has recorded expenditures related to the HYCC-3 project under this program for the established pre-award period, which dated from January 30, 2023 as part of the FY24 expenditures. Previously, a portion of the total expenditures was included within the FY23 SEFA under Assistance Listing #20.315, for the total amount of $15.6 million. This amount was not adjusted out of the cumulative expenditures for Assistance Listing #20.315 until 2025. Consequently, these expenditures were listed both within the FY23 SEFA under Assistance Listing #20.315 and under the FY24 SEFA as Assistance Listing #20.314 expenditures. 4. As part of SEFA preparation as it relates to allocation of operating expenditures across multiple funding sources, certain projects were incorrectly mapped to annual grants funding source, which resulted in approximately $0.3 million of operating expenses to be included within Assistance Listing #20.315 that were also reported under Assistance Listing #97.075. Cause Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not operating in a manner that would timely identify the conditions noted. Additionally, Amtrak’s controls around allocation of federal funding to project codes were not designed in a manner that would timely identify the conditions noted. In reviewing management’s controls around the SEFA preparation, the design of key controls identified by management does not include an overarching review of the SEFA and reconciliation of what’s been reported on the SEFA from individual projects’ standpoint when such projects have multiple assistance listings as funding sources. We also noted that there was not a specific control that ensures timely updates of Work Breakdown Structure (WBS) funding assignments and allocations when there is a change such as a new grant agreement signed. Effect Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not designed in such a manner that would timely identify the conditions noted, which resulted in several versions of the SEFA that were erroneous and inclusion of expenditures that were double counted within the SEFA. This puts Amtrak at greater risk of non-compliance with its grant agreements with respect to questioned costs and an inaccurate SEFA. Questioned Costs None. Context The SEFA, as originally provided, had exceptions as described in the Condition section above noted for matters 1 and 2 in the Criteria section above, indicating that certain internal controls were not functioning as designed and others were not designed effectively. Identification as a Repeat Finding Not a repeat finding. Recommendation We recommend Amtrak to strengthen the SEFA oversight process to ensure appropriate preparation and review of the SEFA to validate its accuracy, including reconciliation with prior year audited SEFA. This should include having one reviewer take overall responsibility for the completeness and accuracy of the final submitted SEFA. This robust review process should include appropriate procedures to confirm accuracy of the SEFA, which may include a protocol where representatives from various groups (both discretionary and non-discretionary federal programs) work collaboratively to review the SEFA and underlying details of expenditures, to ensure all the adjustments have been properly reflected as well as any projects that might have multiple fund sources are identified timely and reviewed for appropriate inclusion within the SEFA. Additionally, Amtrak should establish a process where any modifications of WBS funding assignments and allocations are updated in a timely manner. Views of Responsible Officials Amtrak recognizes the need to improve the preparation and review of the SEFA. The company has documented the steps for preparing and reviewing the SEFA within its process narrative. The company will update the narrative to address the preparation and review issues that led to the multiple versions of the SEFA being provided during the audit. The company will review and update the Grants Management Compliance Narrative and controls to improve timing of updates for modifications of WBS funding assignments. The company is in the process of updating the SEFA preparation documentation for FY2025, which will be used at the end of the year. The review procedures and controls are being enhanced to include a checklist to improve the review.
Program Information: U.S. Department of Commerce NOAA Hatchery Genetic Mgmt – Assistance Listing #11.437 Award Number: NA18NMF4370324 Award Period: 7/01/2018 – 6/30/2024 Criteria: Reporting requirements are contained in the following: Monitoring and reporting program performance, 2 CFR Section 200.329. • Per the award documents, the grantee shall prepare and provide progress reports to Pacific States Marine Fisheries Commission (PSMFC). These run January to June and July to December and are due 15 days after each period. Per 2 CFR § 200.303 Internal controls, the non-federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing the Federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition/Context: NWIFC could not provide support showing review and approval of the progress reports prior to submitting them to PSMFC. [ ] Compliance Finding [ X ] Significant Deficiency [ ] Material Weakness Cause: It appears the policies and procedures for reporting were not followed. Effect: Failing to comply with the grant award requirements, the program may be subject to higher risk status and a decreased amount of funding. Questioned Costs: Not applicable – The condition relates to the lack of review and approval of the required reports before submitting to the funding agency, which does not directly impact the allowability or support for costs charged to the program. No costs are being questioned as a result. Repeat Finding: No. Recommendation: We recommend that the NWIFC adhere to program policies and procedures as documented and supporting documentation is kept available for review. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.
Non-Compliance - Reporting Criteria: 2 CFR section 200.329 Requires certain program performance reports to be filed on a timely basis. Condition: Insufficient controls over performance reporting resulted in program performance reports not being timely filed by the Organization. Context/Cause: The Organization receives federal funding through a passthrough agency, the Alabama Department of Mental Health. In accordance with the contract with the Alabama Department of Mental Health, certain performance reports are required to be filed on a quarterly basis by the 10th of the month following the quarter end. Effects: Due to the resignation of the personnel responsible for filing the required reports, and management’s lack of control over the reporting process, the reports were not timely filed. Recommendation: We recommend that management and the board oversee the reporting function so that issues arising with personnel do not prevent the timely filing of the reports. Auditee’s Response: The Organization will cross train staff and create a schedule for the filing of reports on a timely basis and will monitor this more closely in future.
Non-Compliance - Reporting Criteria: 2 CFR section 200.329 Requires certain program performance reports to be filed on a timely basis. Condition: Insufficient controls over performance reporting resulted in program performance reports not being timely filed by the Organization. Context/Cause: The Organization receives federal funding through a passthrough agency, the Alabama Department of Mental Health. In accordance with the contract with the Alabama Department of Mental Health, certain performance reports are required to be filed on a quarterly basis by the 10th of the month following the quarter end. Effects: Due to the resignation of the personnel responsible for filing the required reports, and management’s lack of control over the reporting process, the reports were not timely filed. Recommendation: We recommend that management and the board oversee the reporting function so that issues arising with personnel do not prevent the timely filing of the reports. Auditee’s Response: The Organization will cross train staff and create a schedule for the filing of reports on a timely basis and will monitor this more closely in future.
Non-Compliance - Reporting Criteria: 2 CFR section 200.329 Requires certain program performance reports to be filed on a timely basis. Condition: Insufficient controls over performance reporting resulted in program performance reports not being timely filed by the Organization. Context/Cause: The Organization receives federal funding through a passthrough agency, the Alabama Department of Mental Health. In accordance with the contract with the Alabama Department of Mental Health, certain performance reports are required to be filed on a quarterly basis by the 10th of the month following the quarter end. Effects: Due to the resignation of the personnel responsible for filing the required reports, and management’s lack of control over the reporting process, the reports were not timely filed. Recommendation: We recommend that management and the board oversee the reporting function so that issues arising with personnel do not prevent the timely filing of the reports. Auditee’s Response: The Organization will cross train staff and create a schedule for the filing of reports on a timely basis and will monitor this more closely in future.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Program Affected Assistance Listing 93.566 Department of Health and Human Services - Direct Award Refugee and Entrant Assistance State/Replacement Designee Administered Programs Award Year October 1, 2023 through September 30, 2025 Criteria 2 CFR §200.329(a) specifies that "The recipient and subrecipient must monitor their activities under Federal awards to ensure they are compliant with all requirements and meeting performance expectations. Monitoring by the recipient and subrecipient must cover each program, function, or activity." Condition and Context Management was notified by program staff that invoices for services rendered during the last quarter of the fiscal year were pending approval and were therefore not captured in the year end accrual. An internal control deficiency was identified related to monitoring of the subrecipient's programmatic activity which are only performed sporadically, and as such, review of such activity at year end was not completed in a timely manner. Cause and Effect The condition identified was caused by infrequent and informal review of program-related subrecipient costs, which were not reconciled as this process was not occurring on a regularly scheduled basis. This resulted in an understatement of program-related subrecipient expenses of $247,119. The schedule of expenditures of federal awards has been adjusted to include these expenses. Recommendation We recommend the Organization perform monthly reconciliations of programmatic accruals for its subrecipients and adjust general ledger accounts accordingly. Management's estimate should materially reflect the services rendered for which the Organization is responsible. Identification as a Repeat Finding, if Applicable Not applicable. Views of Responsible Officials and Planned Corrective Action Management agrees with the finding. See attached Corrective Action Plan.
Reporting (Significant Deficiency and Noncompliance) Information on the federal program: U.S. Department of the Homeland Security, Assistance listing # 97.044 Assistance to Firefighters Criteria: CFR 200.329c requires that reports submitted quarterly or semiannually must be filed no later than 30 calendar days after the reporting period. Condition: We examined the two semiannual Programmatic Performance reports and the semiannual SF425 financial report required to be submitted during the City’s fiscal year. Two of these were not filed within 30 days of specified reporting period as required. Cause: The reports not submitted timely were due July 30. The City’s controls around reporting focus on fiscal and calendar year end. The calendar-year semiannual reporting period is not in the City’s normal reporting schedule and therefore was not addressed through the controls in place. Both reports were filed within 16 days of the due date. Effect: The City did not timely fulfill all the related reporting requirements. Repeat Finding: Yes. Questioned Costs: None reported. Recommendation: We recommend the City strengthen its policies and procedures surrounding grant reporting to include (at inception of each award) documentation of a schedule of reporting requirements, review, and approvals to ensure compliance and documentation of that compliance is retained to support applicable requirements. Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan included at the end of the report.
2024-002 U.S. Department of Treasury, Federal Financial Assistance Listing #21.027, COVID-19 – Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) Matching, Level of Effort and Earmarking; Reporting Significant Deficiency in Internal Control over Compliance Criteria: Recipients of CSLFRF can calculate lost revenue for the years 2020, 2021, 2022, and 2023 based on the formula provided in the 2022 Final Rule to determine the amount of CSLFRF funds that can be used for the “provision of government services”. In calculating revenue loss, recipients can choose whether to use calendar or fiscal year dates but must be consistent throughout the period of performance. If calculating revenue loss, recipients must provide auditors with evidence supporting their revenue loss calculation. Non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB (2 CFR section 200.329). Condition: During the testing over Earmarking, it was noted the County was not able to completely support the amounts used in the calculation. Further, there was no evidence of review of the calculation. Cause: The County’s controls were not sufficient to ensure someone other than the preparer of the revenue loss calculation reviewed the calculation prior to its submission on the County’s quarterly reports. Effect: The revenue loss number calculated by the County was incorrect. This incorrect number was reported to the Treasury as part of the County’s quarterly reporting requirement. Questioned Costs: None reported. Context/Sampling: Sampling was not used for the Earmarking compliance test as there was only 1 revenue loss calculation. A statistical sample of 2 reports were selected for testing out of a total population of 4. Repeat Finding from Prior Year(s): No Recommendation: Management should review the revenue loss calculation to ensure it is appropriately supported by underlying documentation. For all future reports submitted to the Treasury, the recalculated revenue loss amount should be used. Views of Responsible Officials: The County agrees with the auditor’s findings
Finding 2024-001: Preparation of Schedule of Expenditures of Federal Awards (SEFA) Program Name: Multiple federal programs Criteria 1. The code of federal regulations – 2 CFR 200.302 Financial management requires that: (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 funds. All recipient and subrecipient 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 the terms and conditions; and tracking expenditures to establish that funds have been used in accordance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) The recipient’s and subrecipient’s financial management system must provide for the following: (1) Identification 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, year the Federal award was issued, and name of the Federal agency or pass-through entity. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in § 200.328 and § 200.329. When a Federal agency or pass-through entity requires reporting on an accrual basis from a recipient or subrecipient that maintains its records other than on an accrual basis, the recipient or subrecipient must not be required to establish an accrual accounting system. This recipient or subrecipient may develop accrual data for its reports based on an analysis of the documentation on hand. 2. The code of federal regulations – 2 CFR 200.303 Internal controls requires that recipients and subrecipients must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). (b) Comply with the U.S. Constitution, Federal statutes, regulations, and the terms and conditions of the Federal award. (c) Evaluate and monitor the recipient’s or subrecipient’s compliance with statutes, regulations, and the terms and conditions of Federal awards. (d) Take prompt action when instances of noncompliance are identified. Condition The following exceptions to the criteria were observed during the performance of the audit procedures: 1. After the completion of internal review and approval process that Amtrak has established for SEFA preparation and review, we have received multiple updated versions of the schedule with changes to FY24 expenditure amounts for three Assistance Listings included on the SEFA. Total expenditures increased by $80.2 million from version 1 to the final version received. 2. The starting point of the SEFA preparation for the current year was not the audited FY23 SEFA submitted to Federal Audit Clearinghouse, as we have identified that Amtrak subsequently made changes to the FY23 internal SEFA document without reconciling the changes to the audited FY23 SEFA, which resulted in the total cumulative expenditures as of 9/30/2023 to be updated and as such impacting the FY24 expenditures for the respective federal programs. One of the adjustments related to the Hudson Yards Concrete Casing project (HYCC-3) which initially incorrectly recorded $25.0 million of prepaid expenditures. 3. As Assistance Listing #20.314 has been obligated as of 9/27/2024, Amtrak has recorded expenditures related to the HYCC-3 project under this program for the established pre-award period, which dated from January 30, 2023 as part of the FY24 expenditures. Previously, a portion of the total expenditures was included within the FY23 SEFA under Assistance Listing #20.315, for the total amount of $15.6 million. This amount was not adjusted out of the cumulative expenditures for Assistance Listing #20.315 until 2025. Consequently, these expenditures were listed both within the FY23 SEFA under Assistance Listing #20.315 and under the FY24 SEFA as Assistance Listing #20.314 expenditures. 4. As part of SEFA preparation as it relates to allocation of operating expenditures across multiple funding sources, certain projects were incorrectly mapped to annual grants funding source, which resulted in approximately $0.3 million of operating expenses to be included within Assistance Listing #20.315 that were also reported under Assistance Listing #97.075. Cause Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not operating in a manner that would timely identify the conditions noted. Additionally, Amtrak’s controls around allocation of federal funding to project codes were not designed in a manner that would timely identify the conditions noted. In reviewing management’s controls around the SEFA preparation, the design of key controls identified by management does not include an overarching review of the SEFA and reconciliation of what’s been reported on the SEFA from individual projects’ standpoint when such projects have multiple assistance listings as funding sources. We also noted that there was not a specific control that ensures timely updates of Work Breakdown Structure (WBS) funding assignments and allocations when there is a change such as a new grant agreement signed. Effect Amtrak’s control procedures in place as it relates to the preparation of the SEFA were not designed in such a manner that would timely identify the conditions noted, which resulted in several versions of the SEFA that were erroneous and inclusion of expenditures that were double counted within the SEFA. This puts Amtrak at greater risk of non-compliance with its grant agreements with respect to questioned costs and an inaccurate SEFA. Questioned Costs None. Context The SEFA, as originally provided, had exceptions as described in the Condition section above noted for matters 1 and 2 in the Criteria section above, indicating that certain internal controls were not functioning as designed and others were not designed effectively. Identification as a Repeat Finding Not a repeat finding. Recommendation We recommend Amtrak to strengthen the SEFA oversight process to ensure appropriate preparation and review of the SEFA to validate its accuracy, including reconciliation with prior year audited SEFA. This should include having one reviewer take overall responsibility for the completeness and accuracy of the final submitted SEFA. This robust review process should include appropriate procedures to confirm accuracy of the SEFA, which may include a protocol where representatives from various groups (both discretionary and non-discretionary federal programs) work collaboratively to review the SEFA and underlying details of expenditures, to ensure all the adjustments have been properly reflected as well as any projects that might have multiple fund sources are identified timely and reviewed for appropriate inclusion within the SEFA. Additionally, Amtrak should establish a process where any modifications of WBS funding assignments and allocations are updated in a timely manner. Views of Responsible Officials Amtrak recognizes the need to improve the preparation and review of the SEFA. The company has documented the steps for preparing and reviewing the SEFA within its process narrative. The company will update the narrative to address the preparation and review issues that led to the multiple versions of the SEFA being provided during the audit. The company will review and update the Grants Management Compliance Narrative and controls to improve timing of updates for modifications of WBS funding assignments. The company is in the process of updating the SEFA preparation documentation for FY2025, which will be used at the end of the year. The review procedures and controls are being enhanced to include a checklist to improve the review.