Failure to inform auditors of the need for a single audit. Federal programs impacted: All ALNs, see SEFA. (General) Questioned Costs: None, NA Condition: The Clinic expended more than $750,000 in federal awards, triggering a single audit requirement and did not bring this to the auditors attention during the audit. The Clininc failed to properly maintain appropriate records to determine the need for a single audit as required by Uniform Guidance. Criteria: 2 CFR section 200.508(b)&(d) states that one responsibility of the auditee is to prepare appropriate financial statements, including the SEFA in accordance with 200.510. Part (d) states they must provide auditor with information as needed to perform the audit required. See also section 99.300(a). Cause: The Clinic did not have proper controls in place to determine the need for a single audit as required by the Uniform Guidance. Effect: Engagement letter and fees had to be reevaluated, and the nature, timing, and extent of the audit were impacted by the additional requirement. Recommendation: We recommend that the Clinic develops and implements policies and procedures to properly prepare the SEFA. Management Response: Management stated they will do a better job of tracking federal expenditures for the next audit year as they do not want to trigger a single audit again knowingly or otherwise and do not want any delays in the audit like this year.
Finding 2023-001: SEFA – Material Weakness Criteria: U.S. Code § 200.508(b) states that an auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (SEFA) in accordance with § 200.510. U.S. Code § 200.510(b)(3) states that at a minimum the SEFA provide total Federal awards expended for each individual Federal program and the Assistance Listings Number or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. The inclusion of correct Assistance Listing numbers on the SEFA is a critical factor in determining major and non-major programs and designing appropriate audit procedures for individual grants. Condition: The SEFA prepared by management included an incorrect Assistance Listing (AL) number for one grant. Federal grant AL No. 20.513 Enhanced Mobility of Seniors and Individuals with Disabilities was incorrectly identified as AL No. 20.507 Mobility Management. While both grants are from the Federal Transit Agency, they fall under different clusters in the Office of Management and Budget’s Compliance Supplement and thus have different audit requirements. Cause: Paratransit’s internal controls over the completeness of the SEFA were not operating effectively. Effect: The grant in question was initially identified as a major grant and certain audit procedures were applied. The revision of the AL number resulted in this grant being considered non-major, thus not required to be tested. Recommendation: We recommend management verify with the grantor the AL number of the grant. This can be done by obtaining this information from grant documents, or direct communication with the grantor. We further recommend the SEFA be reviewed for accuracy by an individual not included in the SEFA preparation process. Review should be notated with initials and date. Management’s Response: See Corrective Action Plan
Assistance Listing Number, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - N/A Pass-through Entity - Genesee County, Michigan Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared, as it originally included expenditures that were improperly excluded from the SEFA for the year ended June 30, 2022. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated. These revisions related to $136,295 of federal awards expended during the year ended June 30, 2022 that were not reported on the SEFA until the year ended June 30, 2023. These expenditures related to ALN 21.027 (Coronavirus State and Local Fiscal Recovery Funds). This amount did not impact the program type or major program determination for the year ended June 30, 2022. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively. This resulted in the City's schedule of expenditures of federal awards for the prior year being understated and the amounts included in the current year expenditures of federal awards prior to audit-identified revisions. The amounts did not impact the program type or major program determination for the year ended June 30, 2022. Recommendation - The City should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards. Views of Responsible Officials and Corrective Action Plan - The City will implement additional supervisory review of expenditures included on the SEFA.
Assistance Listing Number, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - N/A Pass-through Entity - Genesee County, Michigan Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared, as it originally included expenditures that were improperly excluded from the SEFA for the year ended June 30, 2022. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated. These revisions related to $136,295 of federal awards expended during the year ended June 30, 2022 that were not reported on the SEFA until the year ended June 30, 2023. These expenditures related to ALN 21.027 (Coronavirus State and Local Fiscal Recovery Funds). This amount did not impact the program type or major program determination for the year ended June 30, 2022. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively. This resulted in the City's schedule of expenditures of federal awards for the prior year being understated and the amounts included in the current year expenditures of federal awards prior to audit-identified revisions. The amounts did not impact the program type or major program determination for the year ended June 30, 2022. Recommendation - The City should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards. Views of Responsible Officials and Corrective Action Plan - The City will implement additional supervisory review of expenditures included on the SEFA.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
Assistance Listing, Federal Agency, and Program Name - 20.507, 20.525, 20.526, U.S. Department of Transportation, Federal Transit Cluster Federal Award Identification Number and Year - All Pass-through Entity - N/A Finding Type - Material weakness and material noncompliance Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses. Per 2 CFR 200.71(2), for a SEFA prepared on a cash basis, expenditures are the sum of (i) cash disbursements for direct charges for property and services; (ii) the amount of indirect expense charged; (iii) the value of third-party in-kind contributions applied; and (iv) the amount of cash advance payments and payments made to subrecipients. Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared in accordance with the Authority’s accounting policy for a cash basis SEFA, as it originally included expenditures that were direct charges for property and services, but cash disbursement had not been made as of June 30, 2023. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated on a cash basis. These revisions related to $2,591,504 of federal expenditures where goods and services had been received as of June 30, 2023 that were originally on the SEFA, but cash disbursement had not been made for these direct charges as of June 30, 2023 and therefore should not have been included in the cash basis SEFA. Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively to ensure proper presentation of the SEFA under a cash basis model. This resulted in the Authority's schedule of expenditures of federal awards to be overstated prior to auditor identified revisions. Recommendation - The Authority should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards in the proper period. Views of Responsible Officials and Corrective Action Plan - The SEFA was originally prepared on an accrual basis as has been done in prior years. Due to the ability to use Covid-19 funding for operating expenses, the reporting basis was changed from accrual to cash in FY21-22 without changing internal procedures for creation of the SEFA. This caused the FY22-23 SEFA to be completed on an accrual basis and need to be revised and resubmitted to the auditors. The corrective action has been implemented to revise internal procedures to prepare the SEFA on a cash basis for future fiscal years. This includes the creation of a reconciliation schedule to the financial statements which are prepared on an accrual basis.
2023-003 Internal Control Over Financial Reporting Title and Assistance Listing Number of the Federal Program: 84.425D COVID-19 - Elementary and Secondary School Emergency Relief Fund; 84.425U COVID-19 - American Rescue plan - Elementary and Secondary School Emergency Relief Fiscal Year Finding Originated: 2023 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Name of Federal Agency: Department of Education Pass-through Agency: Louisiana Department of Education / East Baton Rouge Parish School Board Questioned Costs: No questioned costs reported. Condition: Significant audit adjustments were required to fairly present the consolidated financial statements and related Schedule of Expenditures of Federal Awards (SEFA). Criteria: According to 2 CFR 200.508 “Auditee Responsibilities” the auditee must prepare appropriate financial statements, including the SEFA (as specifically defined under 2 CFR 200.510 “Financial statements”). Title 2 CFR 200.510 “Financial statements” requires recipients of Federal funds to prepare a SEFA for the period covered by the auditee’s financial statements, which must include the total Federal awards expended. In addition, as noted in 2 CFR 200.302 “Financial management”, the financial management system of each non-Federal entity must provide for identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received, and records that identify adequately the source and application of funds for federally-funded activities including expenditures. When federal expenditures are incurred over $750,000, a Single Audit is required to be performed under Uniform Guidance. Failure to properly record federal expenditures could cause the Academies to not have a Single Audit performed, or have it performed improperly, which would be considered noncompliant with Uniform Guidance. Cause: The impacts of the financial statement audit adjustments are as follows: • Accounts receivable and revenue related to Employee Retention Tax Credits were overstated by $600,000. • Revenues and expenditures related to reimbursement-based federal grants included in testing as a major program were understated $426,863. The Academies did not record certain grant revenues and expenditures for expenditures paid directly by the granting agency on behalf of the Academies. This adjustment impacted the SEFA and financial statements. • Revenue related to Child Nutrition Program funds were overstated $19,150. This adjustment impacted the SEFA and financial statements. • Adjustments to property and equipment resulting in a net increase to net assets of $29,583. • Adjustments to accumulated depreciation resulting in a net decrease in net assets of $54,906. • Adjustments to inter-school payable amounts resulting in a net increase in net assets of $23,015. • Adjustments to accounts payable resulting in a net increase in net assets of $60,179. • Adjustments to due to management company resulting in a net increase in net assets of $45,903. • Adjustments to compensated absences resulting in a net decrease in net assets of $24,391. Effect: The consolidated financial statements and related SEFA required material adjustments in order to be presented fairly. A lack of accounting practices can cause potential misstatements to remain unidentified and cause the financial statements and related schedules to be misleading. Noncompliance with Uniform Guidance may result in a temporary suspension of federal awards. Recommendation: We recommend the Academies implement monthly financial statement closing procedures which capture all relevant information necessary to reconcile accounts to supporting documentation on a timely basis. These procedures should include implementing internal controls over recording and monitoring revenues related to federal awards to ensure accuracy of funds recorded. Views of responsible officials: See views of responsible officials on page 36.
2023-003 Internal Control Over Financial Reporting Title and Assistance Listing Number of the Federal Program: 84.425D COVID-19 - Elementary and Secondary School Emergency Relief Fund; 84.425U COVID-19 - American Rescue plan - Elementary and Secondary School Emergency Relief Fiscal Year Finding Originated: 2023 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Name of Federal Agency: Department of Education Pass-through Agency: Louisiana Department of Education / East Baton Rouge Parish School Board Questioned Costs: No questioned costs reported. Condition: Significant audit adjustments were required to fairly present the consolidated financial statements and related Schedule of Expenditures of Federal Awards (SEFA). Criteria: According to 2 CFR 200.508 “Auditee Responsibilities” the auditee must prepare appropriate financial statements, including the SEFA (as specifically defined under 2 CFR 200.510 “Financial statements”). Title 2 CFR 200.510 “Financial statements” requires recipients of Federal funds to prepare a SEFA for the period covered by the auditee’s financial statements, which must include the total Federal awards expended. In addition, as noted in 2 CFR 200.302 “Financial management”, the financial management system of each non-Federal entity must provide for identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received, and records that identify adequately the source and application of funds for federally-funded activities including expenditures. When federal expenditures are incurred over $750,000, a Single Audit is required to be performed under Uniform Guidance. Failure to properly record federal expenditures could cause the Academies to not have a Single Audit performed, or have it performed improperly, which would be considered noncompliant with Uniform Guidance. Cause: The impacts of the financial statement audit adjustments are as follows: • Accounts receivable and revenue related to Employee Retention Tax Credits were overstated by $600,000. • Revenues and expenditures related to reimbursement-based federal grants included in testing as a major program were understated $426,863. The Academies did not record certain grant revenues and expenditures for expenditures paid directly by the granting agency on behalf of the Academies. This adjustment impacted the SEFA and financial statements. • Revenue related to Child Nutrition Program funds were overstated $19,150. This adjustment impacted the SEFA and financial statements. • Adjustments to property and equipment resulting in a net increase to net assets of $29,583. • Adjustments to accumulated depreciation resulting in a net decrease in net assets of $54,906. • Adjustments to inter-school payable amounts resulting in a net increase in net assets of $23,015. • Adjustments to accounts payable resulting in a net increase in net assets of $60,179. • Adjustments to due to management company resulting in a net increase in net assets of $45,903. • Adjustments to compensated absences resulting in a net decrease in net assets of $24,391. Effect: The consolidated financial statements and related SEFA required material adjustments in order to be presented fairly. A lack of accounting practices can cause potential misstatements to remain unidentified and cause the financial statements and related schedules to be misleading. Noncompliance with Uniform Guidance may result in a temporary suspension of federal awards. Recommendation: We recommend the Academies implement monthly financial statement closing procedures which capture all relevant information necessary to reconcile accounts to supporting documentation on a timely basis. These procedures should include implementing internal controls over recording and monitoring revenues related to federal awards to ensure accuracy of funds recorded. Views of responsible officials: See views of responsible officials on page 36.
Program: AL 84.287 – Twenty-First Century Community Learning Centers – Subrecipient Monitoring Grant Number & Year: S287C210027, FFY 2022 Federal Grantor Agency: U.S. Department of Education Criteria: Per 2 CFR § 3474.1 (January 1, 2023), the U.S. Department of Education adopted the OMB Uniform Guidance in 2 CFR part 200, except for 2 CFR § 200.102(a) and 200.207(a). 2 CFR § 200.332 (January 1, 2023) states, in relevant part, the following: All pass-through entities must: * * * * (d) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. 2 CFR § 200.508 (January 1, 2023) states, in relevant part, the following: The auditee must: * * * * (d) Provide the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit required by this part. Neb. Rev. Stat. § 84-305(2) (Cum. Supp. 2022) states, in relevant part, the following: Upon receipt of a written request by the Auditor of Public Accounts for access to any information or records, the public entity shall provide to the auditor as soon as is practicable and without delay, but not more than three business days after actual receipt of the request, either (a) the requested materials or (b)(i) if there is a legal basis for refusal to comply with the request, a written denial of the request together with the information specified in subsection (1) of this section or (ii) if the entire request cannot with reasonable good faith efforts be fulfilled within three business days after actual receipt of the request due to the significant difficulty or the extensiveness of the request, a written explanation, including the earliest practicable date for fulfilling the request, and an opportunity for the auditor to modify or prioritize the items within the request. No delay due to the significant difficulty or the extensiveness of any request for access to information or records shall exceed three calendar weeks after actual receipt of such request by any public entity. (Emphasis added.) A proper system of internal control includes procedures to ensure the Department’s fiscal monitoring polices are followed. Good internal control also requires procedures to ensure audit information is provided promptly in accordance with State and Federal requirements. Condition: The Agency failed to perform fiscal monitoring of one subrecipient tested for the Twenty-First Century Community Learning Centers grant. Contrary to § 84-305(2), moreover, the Agency failed to respond promptly to requests for information. Repeat Finding: No Questioned Costs: None Statistical Sample: No Context: The Agency performed a review of a reimbursement request for $183,825, where staff compared the amount claimed to the school-provided accounting records and payroll reports with employee names. The Agency’s policy then requires further fiscal monitoring on at least a three-year rotational basis for all school districts. As part of this process, a more detailed review of time and effort documentation is supposed to be completed. According to Agency staff, fiscal monitoring was scheduled for October 2022; however, school district staff stated that the timing would not work for them. The Agency began its review in December 2022, but the process had yet to be completed – more than a year later – due to a lack of responsiveness from the school district. Fiscal monitoring of the school district was last performed in fiscal year 2020. Additionally, the APA asked the Agency on January 11, 2024, for documentation to support the payroll expenses on the reimbursement request. On January 12, 2024, the Agency presented the APA with the documentation from the school district; however, this was the same documentation provided previously to the Agency at the time of reimbursement. This documentation was insufficient to support the payroll expenses questioned. On March 1, 2024, seven weeks after the APA’s request, the Agency produced the additional information to support the payroll expenses. Cause: Inadequate subrecipient monitoring procedures. Effect: Without adequate monitoring procedures, there is an increased risk for the payment of unallowable Federal expenses. Recommendation: We recommend the Agency strengthen its procedures for ensuring that fiscal monitoring is completed in accordance with the Agency’s policies. We further recommend the Agency implement procedures to ensure compliance with both 2 CFR § 200.508 and § 84-305(2). Management Response: The Grants Compliance Section is the Agency’s internal control function performing the requirements within 2 CFR 200.332, applying risk assessment to determine the annual fiscal monitoring base cadence and sequential sampling; non-probability sampling ensuring all recipients are subject to fiscal monitoring efforts in a three-year cycle at a minimum. As education subrecipients have received a significant influx of subawards to mitigate post-COVID supports for Nebraska education with limited staff capacity, the Department has remained mindful of these conditions and completed fiscal monitoring activities and issued an exit letter on September 5, 2023. APA Response: This finding was included as Comment 4 in the Annual Comprehensive Financial Report (ACFR) management letter dated December 13, 2023. The Agency responded, in part, “Fiscal monitoring of Lexington Public Schools was being performed in 2023 but was not completed as of the time of the ACFR audit.” When the Single Audit team requested the payroll documentation, the Agency did not inform the APA that monitoring was completed until March 5, 2024, which is well past the time requirements set out in § 84-305(2). Regardless, the fiscal monitoring was not completed within three years.
2 CFR 200.508 requires that proper internal controls are in place for the preparation of the Schedule of Expenditures of Federal Awards (SEFA), which must include the total federal awards expended and the Assistance Listing Number for each individual federal program. The auditors are required to determine whether the SEFA is stated fairly in all material respects in relation to the auditee’s financial statements as a whole. The auditors also utilize the SEFA for the determination of the major federal programs that will be audited. Condition During our audit, we became aware of a material misstatement in the SEFA due to an excluded federal program: the Transportation Infrastructure Finance and Innovation Act (TIFIA) Program with federal expenditures of $537,484,439 for the fiscal year ended June 30, 2023. Effect As a result of correcting the error in the SEFA, the TIFIA program was assessed for testing as a major program and met the criteria to require the program to be tested. Additionally, another major program that had already been selected and tested no longer was required to be tested as a major program. Cause The TIFIA program expenditures were new in the fiscal year ended June 30, 2023 and SANDAG’s system of internal controls did not identify the program as federal expenditures subject to the single audit requirements. Recommendation We recommend SANDAG enhance the system of internal controls for identification of federal awards subject to the single audit requirements and the preparation and review of the SEFA for accuracy and completeness.
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 66.468 Drinking Water State Revolving Fund Name of Federal Agency: Environmental Protection Agency Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was not presented for audit. The City was unaware that funds borrowed through Business Oregon were federally sourced. Cause: The loan documents that were provided to the City were modified and date back several years. No individual, including those employed by the City, project managers engaged by the City, and pass-through managers were apparently aware that the loan proceeds were from federal sources. Consequently, no internal controls were designed or implemented regarding accounting for or preparation of the SEFA. The City did not provide a reconciliation of the expenditures of federal awards with amounts reported on the City’s general ledger. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • No SEFA was originally presented for auditors. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: Yes 2022-002 Recommendation: We recommend that the City establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The City should provide appropriate training to staff who are assigned to prepare and review the SEFA. City’s Response: The City acknowledges the deficiencies. Corrective Action Plan: The City will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: City Manager
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Finding 2023-002 - Schedule of Expenditures of Federal Awards (Material Weakness) CFDA Title and Number 84.425 Education Stabilization Fund Name of Federal Agency: U.S. Department of Education CFDA Title and Number 10.555 National School Lunch Program cluster Name of Federal Agency: U.S. Department of Agriculture Compliance/Internal Control over Compliance: Auditee Responsibilities Criteria: CFR Part 200.508, CFR Part 200.510, Auditee Responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list individual Federal awards by Federal Agency, including the total Federal awards expended, name of the pass-through entity, CFDA number, and total amount provided to subrecipients. The information contained in the Schedule of Expenditures of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. Condition: The Schedule of Expenditures of Federal Awards (SEFA) was presented for audit with values that were not reconciled with the general ledger. Cause: The District relied on individuals with insufficient training or support to prepare the SEFA and ensure that it was reconciled with general ledger amounts. District management did not have sufficient training or monitoring policies to recognize and correct the deficiency. Effect or Potential Effect: Expenditures of federal awards and not be detected and corrected. Because the Auditee’s SEFA was completed incorrectly, and not reconciled to the general ledger the SEFA was materially misstated, prior to auditors’ correction recommendations. Questioned Cost: No Context: Lack of adequate controls over the Schedule of Expenditures of Federal Awards and related accounting resulted in the following: • SEFA was originally presented for auditors with incorrect information. • No reconciliation between federal expenditures reported on the GL and the SEFA was presented. Repeat of a Prior-Year Finding: No Recommendation: We recommend that the District establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Internal controls should be designed to prevent, detect, or correct errors in a timely manner by performing periodic reconciliations of the SEFA information to the general ledger throughout the fiscal year. The District should provide appropriate training to staff who are assigned to prepare and review the SEFA. District’s Response: The District acknowledges the deficiencies. Corrective Action Plan: The District will establish policies and procedures to ensure that all Federal awards are identified and reported accurately on future SEFAs. Planned Implementation Date: October 1, 2024 Responsible Person: Director of Business Services, Yamhill County School District No. 8
Material Weakness over Schedule of Expenditures of Federal Awards (SEFA) Reporting Repeat Finding: Yes, 2022-006 Condition: Finance is responsible for preparing the schedule of expenditures of Federal awards based upon grant information obtained from the financial accounting records and other information provided by each department or agency. In many instances, the detail expenditure information in the accounting software differed from the expenditures reported by various City departments. Additionally, expenditures related to sub-recipients, subcontractors, and beneficiaries are not separately tracked in the general ledger. Criteria: In accordance with 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. In accordance with 2 CFR 200.508, Auditee responsibilities: The auditee must: (b) Prepare appropriate financial statements, including the schedule of expenditures of Federal awards in accordance with §200.510 Financial statements. In accordance with 2 CFR 200.510, Financial statements: (b) Schedule of expenditures of Federal awards: the auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple Federal award years, the auditee may list the amount of Federal awards expended for each Federal award year separately. At a minimum, the schedule must: (1) List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For R&D, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. (2) For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. (3) Provide total Federal awards expended for each individual Federal program and the AL number or other identifying number when the AL information is not available. For a cluster of programs, also provide the total for the cluster. (4) Include the total amount provided to subrecipients from each Federal program. (5) For loan or loan guarantee programs described in § 200.502(b), identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule and (6) Include notes that describe that significant accounting policies used in preparing the schedule and note whether or not the non-Federal entity elected to use the 10% de minimis cost rate as covered in §200.414 Indirect (F&A) costs. Cause: The City does not maintain a centralized grant accounting function or standardized policies and procedures, including requirements to periodically submit and reconcile expenditures; instead, each department maintains its own grant information. The lack of submission of grant documents and accurate information by the various agencies and departments to Finance weakens internal controls over grant reporting and hinders the ability of Finance to accurately prepare the Schedule. Internal controls over financial reporting should be designed to prevent, detect or correct errors in a timely manner. Without adequate controls, the City cannot provide reasonable assurance that the Schedule is fairly presented. Controls have not been established by the City to ensure complete and accurate reporting for the Schedule for the 2023 fiscal year. Effect: The determination of which major programs will be audited is affected by the accuracy of the Schedule at the time of audit. Without proper internal controls over financial reporting, inaccurate reporting of the City’s financial information could occur and the City cannot provide reasonable assurance that the SEFA is fairly presented. As a result, individual program reports throughout the year could have inaccurate information. There were also significant delays in the preparation of the Schedule of Expenditures of Federal awards, which prevented the City from meeting the March 31, 2024 deadline with the Federal clearinghouse. Questioned Costs: Unknown. Recommendation: We recommend that Finance establish policies and procedures to ensure that the Federal funds are properly identified and reported accurately in the Schedule in accordance with Uniform Guidance requirements. We also recommend that individuals responsible for administering Federal assistance programs with the City receive training in grant administration. Auditee Response and Corrective Action Plan: Management agrees with the finding. Refer to the corrective action plan on current findings in Part V of this report. Auditor’s Conclusion: Finding remains as stated.