Finding 2022-006 Programs: All Material Weakness over Schedule of Expenditures of Federal Awards (SEFA) Reporting Repeat Finding: Yes Condition: During our fiscal year 2022 audit, we observed that the detail expenditure information in the accounting software differed from the expenditures reported by various City departments. We were not able to determine if the Federal expenditures and subrecipient payments for all grants from the City was complete. Additionally, there were unreconciled amounts passed through to subrecipients. 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. Per discussion with Finance, we became aware that grant information and documents are not maintained by Finance. Grant documents are necessary for Finance to obtain required information for the Schedule, such as AL titles and numbers, pass through identification information and subrecipient information. 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. Finding 2022-006 (continued) Criteria: (continued) (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. Controls have not been established by the City to ensure complete and accurate reporting for the Schedule for the 2022 fiscal year. Effect: The determination of which major Federal programs will be audited are 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. As a result, individual program reports throughout the year could have inaccurate information. 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. 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. 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.
Finding 2022-006 Programs: All Material Weakness over Schedule of Expenditures of Federal Awards (SEFA) Reporting Repeat Finding: Yes Condition: During our fiscal year 2022 audit, we observed that the detail expenditure information in the accounting software differed from the expenditures reported by various City departments. We were not able to determine if the Federal expenditures and subrecipient payments for all grants from the City was complete. Additionally, there were unreconciled amounts passed through to subrecipients. 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. Per discussion with Finance, we became aware that grant information and documents are not maintained by Finance. Grant documents are necessary for Finance to obtain required information for the Schedule, such as AL titles and numbers, pass through identification information and subrecipient information. 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. Finding 2022-006 (continued) Criteria: (continued) (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. Controls have not been established by the City to ensure complete and accurate reporting for the Schedule for the 2022 fiscal year. Effect: The determination of which major Federal programs will be audited are 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. As a result, individual program reports throughout the year could have inaccurate information. 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. 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. 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.
Assistance Listing Number, Federal Agency, and Program Name - ALN 17.207 Employment Services Cluster, ALN 17.258, 17.259, and 17.278 WIOA Cluster Federal Award Identification Number and Year - Wagner Peyser ES -MWSC Operations, AY 20 WIOA Adult Pass-through Entity - Michigan Department of Labor and Economic Opportunity - Workforce Development Agency Finding Type - Significant deficiency Repeat Finding - No Criteria - An auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards (the "Schedule"), as required by 2 CFR 200.508. The Schedule should be for the period covered by the auditee's financial statements, which must include the total federal awards expended. Condition - The controls in place were not adequate to ensure the Schedule was complete and accurate. Questioned Costs - Not applicable Identification of How Questioned Costs Were Computed - Not applicable Context - The original Schedule provided for audit did not reconcile to the general ledger and changed by approximately $480,000 between the original and final version. The most significant changes impacted the WIOA cluster and TANF federal programs. Cause and Effect - An accurate Schedule is a necessary component of major program selection. Without proper processes and controls to determine the completeness and accuracy of the Schedule, DESC risks noncompliance with federal requirements. Recommendation - DESC should perform a thorough review of the Schedule and ensure it reconciles to the underlying general ledger prior to the onset of the audit. Views of Responsible Officials and Planned Corrective Actions - DESC has replaced members and expanded the number of members on the fiscal/accounting team, including an experienced accounting manager and senior accountant, and implemented a training program to ensure all fiscal/accounting team members are aware of and understands their duties and responsibilities as related to the reconciliation of the grants in their portfolio, which is the basis for the creation of the Schedule. Additionally, audit procedures are being put in place to ensure that the Schedule is created and reviewed, at minimum, on a semiannual basis.
Assistance Listing Number, Federal Agency, and Program Name - ALN 17.207 Employment Services Cluster, ALN 17.258, 17.259, and 17.278 WIOA Cluster Federal Award Identification Number and Year - Wagner Peyser ES -MWSC Operations, AY 20 WIOA Adult Pass-through Entity - Michigan Department of Labor and Economic Opportunity - Workforce Development Agency Finding Type - Significant deficiency Repeat Finding - No Criteria - An auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards (the "Schedule"), as required by 2 CFR 200.508. The Schedule should be for the period covered by the auditee's financial statements, which must include the total federal awards expended. Condition - The controls in place were not adequate to ensure the Schedule was complete and accurate. Questioned Costs - Not applicable Identification of How Questioned Costs Were Computed - Not applicable Context - The original Schedule provided for audit did not reconcile to the general ledger and changed by approximately $480,000 between the original and final version. The most significant changes impacted the WIOA cluster and TANF federal programs. Cause and Effect - An accurate Schedule is a necessary component of major program selection. Without proper processes and controls to determine the completeness and accuracy of the Schedule, DESC risks noncompliance with federal requirements. Recommendation - DESC should perform a thorough review of the Schedule and ensure it reconciles to the underlying general ledger prior to the onset of the audit. Views of Responsible Officials and Planned Corrective Actions - DESC has replaced members and expanded the number of members on the fiscal/accounting team, including an experienced accounting manager and senior accountant, and implemented a training program to ensure all fiscal/accounting team members are aware of and understands their duties and responsibilities as related to the reconciliation of the grants in their portfolio, which is the basis for the creation of the Schedule. Additionally, audit procedures are being put in place to ensure that the Schedule is created and reviewed, at minimum, on a semiannual basis.
Assistance Listing Number, Federal Agency, and Program Name - ALN 17.207 Employment Services Cluster, ALN 17.258, 17.259, and 17.278 WIOA Cluster Federal Award Identification Number and Year - Wagner Peyser ES -MWSC Operations, AY 20 WIOA Adult Pass-through Entity - Michigan Department of Labor and Economic Opportunity - Workforce Development Agency Finding Type - Significant deficiency Repeat Finding - No Criteria - An auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards (the "Schedule"), as required by 2 CFR 200.508. The Schedule should be for the period covered by the auditee's financial statements, which must include the total federal awards expended. Condition - The controls in place were not adequate to ensure the Schedule was complete and accurate. Questioned Costs - Not applicable Identification of How Questioned Costs Were Computed - Not applicable Context - The original Schedule provided for audit did not reconcile to the general ledger and changed by approximately $480,000 between the original and final version. The most significant changes impacted the WIOA cluster and TANF federal programs. Cause and Effect - An accurate Schedule is a necessary component of major program selection. Without proper processes and controls to determine the completeness and accuracy of the Schedule, DESC risks noncompliance with federal requirements. Recommendation - DESC should perform a thorough review of the Schedule and ensure it reconciles to the underlying general ledger prior to the onset of the audit. Views of Responsible Officials and Planned Corrective Actions - DESC has replaced members and expanded the number of members on the fiscal/accounting team, including an experienced accounting manager and senior accountant, and implemented a training program to ensure all fiscal/accounting team members are aware of and understands their duties and responsibilities as related to the reconciliation of the grants in their portfolio, which is the basis for the creation of the Schedule. Additionally, audit procedures are being put in place to ensure that the Schedule is created and reviewed, at minimum, on a semiannual basis.
Assistance Listing Number, Federal Agency, and Program Name - ALN 17.207 Employment Services Cluster, ALN 17.258, 17.259, and 17.278 WIOA Cluster Federal Award Identification Number and Year - Wagner Peyser ES -MWSC Operations, AY 20 WIOA Adult Pass-through Entity - Michigan Department of Labor and Economic Opportunity - Workforce Development Agency Finding Type - Significant deficiency Repeat Finding - No Criteria - An auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards (the "Schedule"), as required by 2 CFR 200.508. The Schedule should be for the period covered by the auditee's financial statements, which must include the total federal awards expended. Condition - The controls in place were not adequate to ensure the Schedule was complete and accurate. Questioned Costs - Not applicable Identification of How Questioned Costs Were Computed - Not applicable Context - The original Schedule provided for audit did not reconcile to the general ledger and changed by approximately $480,000 between the original and final version. The most significant changes impacted the WIOA cluster and TANF federal programs. Cause and Effect - An accurate Schedule is a necessary component of major program selection. Without proper processes and controls to determine the completeness and accuracy of the Schedule, DESC risks noncompliance with federal requirements. Recommendation - DESC should perform a thorough review of the Schedule and ensure it reconciles to the underlying general ledger prior to the onset of the audit. Views of Responsible Officials and Planned Corrective Actions - DESC has replaced members and expanded the number of members on the fiscal/accounting team, including an experienced accounting manager and senior accountant, and implemented a training program to ensure all fiscal/accounting team members are aware of and understands their duties and responsibilities as related to the reconciliation of the grants in their portfolio, which is the basis for the creation of the Schedule. Additionally, audit procedures are being put in place to ensure that the Schedule is created and reviewed, at minimum, on a semiannual basis.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding #2022-001 ? Timely Completion and Submission of Audit Under Uniform Guidance and Incomplete Schedule of Expenditures of Federal Awards (Material Weakness) Agreements: All Criteria ? 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards: ? #200.512 (a)(1) The auditee must complete and submit the single audit report within nine months of the organization?s year-end. ? #200.508 (b) The auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with #200.510, Financial Statements. Condition and Context ? Requests required to complete the audit were not submitted within sufficient time to allow for audit and reporting prior to the deadline. The following errors and missing required elements were noted and corrected as a result of auditing procedures on the SEFA: ? Expenditures under agreement MHC-22-322B under CFDA 93.665 were not included. ? Expenditures under agreement CBH-22-1003A under CFDA 93.958 were not included. ? Expenditures under Period 4 of Provider Relief Funds (PRF) were included in error. ? There were two instances of COVID-19 programs that did not include the appropriate prefix. ? Subtotals were not included for the following CFDA numbers 93.958; 93.104; and 93.243. ? Expenditures under agreement CDM-21-4462A under CFDA 93.243 were shown included under CFDA 93.959 in error. Cause ? Loss of key management personnel that pulled time resources from key financial personnel. Insufficient internal controls over the preparation and review process for the SEFA. Effect ? The errors noted and above corrections would have led to the SEFA being materially misstated. The single audit report was not filed by the deadline. Recommendations ? Management should seek additional training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Both the preparer and reviewer should have a clear understanding of the required minimum elements. As part of the review, all required minimum elements should be vouched to original source documents including copies of awards, reporting, and the trial balance. Any inconsistencies should be resolved before beginning the audit. The compliance supplement should be review for reporting guidance on new Federal programs. Questioned Costs ? None Management Response ? Management will seek additional training in preparation of the SEFA and the applicable standards.
Finding 2022-003 - Preparation of the SEFA Information on the Federal Program: All Federal programs Criteria or Specific Requirement: Title 2 CFR 200.508 ?Auditee Responsibilities? indicates that the auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (as specifically defined under 2 CFR 200.510 ?Financial statements?). Title 2 CFR 200 Section 200.510 ?Financial Statements? requires recipients of Federal funds to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total Federal awards expended. Additionally, in accordance with CFR 200.303, the non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Aquarium did not appropriately identify and track its Federal expenditures incurred under direct and pass-through Federal awards during the year under audit. Cause: The Aquarium did not maintain appropriate internal controls to correctly identify and track awards provided from the federal government, including those received through pass through entities. Effect or Potential Effect: The Aquarium incurred expenditures in excess of the $750,000 threshold, requiring a Uniform Guidance compliance examination. Questioned Costs: None noted. Context: The SEFA must be prepared by the auditee (as described in ?Criteria? above). Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that the Aquarium establish internal controls to correctly identify and track all Federal awards received either directly or indirectly. The expenditures incurred under direct and pass-through awards should be evaluated in aggregate periodically throughout the year (and at year-end) to determine if the Aquarium has reached the Uniform Guidance threshold. The Aquarium should ensure that the Uniform Guidance audit is completed, and the complete reporting package submitted to the Federal Audit Clearinghouse in advance of the reporting deadlines.
Finding 2022-003 - Preparation of the SEFA Information on the Federal Program: All Federal programs Criteria or Specific Requirement: Title 2 CFR 200.508 ?Auditee Responsibilities? indicates that the auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (as specifically defined under 2 CFR 200.510 ?Financial statements?). Title 2 CFR 200 Section 200.510 ?Financial Statements? requires recipients of Federal funds to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total Federal awards expended. Additionally, in accordance with CFR 200.303, the non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Aquarium did not appropriately identify and track its Federal expenditures incurred under direct and pass-through Federal awards during the year under audit. Cause: The Aquarium did not maintain appropriate internal controls to correctly identify and track awards provided from the federal government, including those received through pass through entities. Effect or Potential Effect: The Aquarium incurred expenditures in excess of the $750,000 threshold, requiring a Uniform Guidance compliance examination. Questioned Costs: None noted. Context: The SEFA must be prepared by the auditee (as described in ?Criteria? above). Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that the Aquarium establish internal controls to correctly identify and track all Federal awards received either directly or indirectly. The expenditures incurred under direct and pass-through awards should be evaluated in aggregate periodically throughout the year (and at year-end) to determine if the Aquarium has reached the Uniform Guidance threshold. The Aquarium should ensure that the Uniform Guidance audit is completed, and the complete reporting package submitted to the Federal Audit Clearinghouse in advance of the reporting deadlines.
Finding 2022-003 - Preparation of the SEFA Information on the Federal Program: All Federal programs Criteria or Specific Requirement: Title 2 CFR 200.508 ?Auditee Responsibilities? indicates that the auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (as specifically defined under 2 CFR 200.510 ?Financial statements?). Title 2 CFR 200 Section 200.510 ?Financial Statements? requires recipients of Federal funds to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total Federal awards expended. Additionally, in accordance with CFR 200.303, the non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Aquarium did not appropriately identify and track its Federal expenditures incurred under direct and pass-through Federal awards during the year under audit. Cause: The Aquarium did not maintain appropriate internal controls to correctly identify and track awards provided from the federal government, including those received through pass through entities. Effect or Potential Effect: The Aquarium incurred expenditures in excess of the $750,000 threshold, requiring a Uniform Guidance compliance examination. Questioned Costs: None noted. Context: The SEFA must be prepared by the auditee (as described in ?Criteria? above). Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that the Aquarium establish internal controls to correctly identify and track all Federal awards received either directly or indirectly. The expenditures incurred under direct and pass-through awards should be evaluated in aggregate periodically throughout the year (and at year-end) to determine if the Aquarium has reached the Uniform Guidance threshold. The Aquarium should ensure that the Uniform Guidance audit is completed, and the complete reporting package submitted to the Federal Audit Clearinghouse in advance of the reporting deadlines.
Finding 2022-003 - Preparation of the SEFA Information on the Federal Program: All Federal programs Criteria or Specific Requirement: Title 2 CFR 200.508 ?Auditee Responsibilities? indicates that the auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (as specifically defined under 2 CFR 200.510 ?Financial statements?). Title 2 CFR 200 Section 200.510 ?Financial Statements? requires recipients of Federal funds to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total Federal awards expended. Additionally, in accordance with CFR 200.303, the non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Aquarium did not appropriately identify and track its Federal expenditures incurred under direct and pass-through Federal awards during the year under audit. Cause: The Aquarium did not maintain appropriate internal controls to correctly identify and track awards provided from the federal government, including those received through pass through entities. Effect or Potential Effect: The Aquarium incurred expenditures in excess of the $750,000 threshold, requiring a Uniform Guidance compliance examination. Questioned Costs: None noted. Context: The SEFA must be prepared by the auditee (as described in ?Criteria? above). Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that the Aquarium establish internal controls to correctly identify and track all Federal awards received either directly or indirectly. The expenditures incurred under direct and pass-through awards should be evaluated in aggregate periodically throughout the year (and at year-end) to determine if the Aquarium has reached the Uniform Guidance threshold. The Aquarium should ensure that the Uniform Guidance audit is completed, and the complete reporting package submitted to the Federal Audit Clearinghouse in advance of the reporting deadlines.
Finding 2022-003 - Preparation of the SEFA Information on the Federal Program: All Federal programs Criteria or Specific Requirement: Title 2 CFR 200.508 ?Auditee Responsibilities? indicates that the auditee must prepare appropriate financial statements, including the Schedule of Expenditures of Federal Awards (as specifically defined under 2 CFR 200.510 ?Financial statements?). Title 2 CFR 200 Section 200.510 ?Financial Statements? requires recipients of Federal funds to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total Federal awards expended. Additionally, in accordance with CFR 200.303, the non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Aquarium did not appropriately identify and track its Federal expenditures incurred under direct and pass-through Federal awards during the year under audit. Cause: The Aquarium did not maintain appropriate internal controls to correctly identify and track awards provided from the federal government, including those received through pass through entities. Effect or Potential Effect: The Aquarium incurred expenditures in excess of the $750,000 threshold, requiring a Uniform Guidance compliance examination. Questioned Costs: None noted. Context: The SEFA must be prepared by the auditee (as described in ?Criteria? above). Identification as a Repeat Finding, if Applicable: This is not a repeat finding. Recommendation: We recommend that the Aquarium establish internal controls to correctly identify and track all Federal awards received either directly or indirectly. The expenditures incurred under direct and pass-through awards should be evaluated in aggregate periodically throughout the year (and at year-end) to determine if the Aquarium has reached the Uniform Guidance threshold. The Aquarium should ensure that the Uniform Guidance audit is completed, and the complete reporting package submitted to the Federal Audit Clearinghouse in advance of the reporting deadlines.
2022?006 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Repeat of Prior Year Findings 2021?004 and 2020?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.508(b) states, ?The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards.? The Federal Office of Management and Budget issues instructions on how to prepare this schedule. Condition: Workforce West Virginia?s (WWV?s) internal controls are not adequate to ensure that the Schedule of Expenditures Federal Awards (SEFA) accurately reports all federal assistance. It was noted the SEFA was resubmitted due to errors causing untimely submission. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the SEFA reporting processes were not adequately enforced to ensure the SEFA is accurate due to lack of training. Effect: WWV is not properly reporting their federal expenditures and type A programs may not be appropriately identified on a timely basis. Recommendation: We recommend that WWV ensure staff responsible for the preparation of the SEFA have the resources needed to accurately prepare the SEFA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022-034 Oregon Housing and Community Services Ensure review of subrecipient requests for funds verifies immediate cash needs are supported Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.568 Low-Income Home Energy Assistance Program, 93.568 Low-Income Home Energy Assistance Program (COVID-19) Federal Award Numbers and Years: 2001ORE5C3, 2020 (COVID-19); 2102ORLIEA, 2021; 2102ORE5C6, 2021 (COVID-19); 2202ORLIEA, 2022 Compliance Requirement: Cash Management Type of Finding: Significant Deficiency; Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR ? 200.305(b), (b)(1); 2 CFR ? 200.508 Federal regulations require that auditees maintain documentation as needed for the performance of audit procedures related to the Single Audit. Additionally, regulations require payment advances should be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the subrecipient for carrying out the approved program. We reviewed 60 sample cash draws and were unable to obtain adequate supporting documentation for 4 subrecipient requests for reimbursement/advances demonstrating they were appropriate and for immediate cash needs. We also identified an advance payment for which there was not an adequate explanation indicating why an advance was needed. These 5 exceptions totaled $124,304 in expenditures. Department management cited a breakdown in control process and communicated their intention to train relevant staff to ensure adequate support is obtained. Without adequate verification of cash needs, the department could be sending funds to subrecipients that are not for a reimbursement of expenditures or immediate cash needs. We recommend department management strengthen internal controls to ensure support for subrecipient requests for funds adequately documents they are appropriate and for immediate cash needs.
2022-034 Oregon Housing and Community Services Ensure review of subrecipient requests for funds verifies immediate cash needs are supported Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.568 Low-Income Home Energy Assistance Program, 93.568 Low-Income Home Energy Assistance Program (COVID-19) Federal Award Numbers and Years: 2001ORE5C3, 2020 (COVID-19); 2102ORLIEA, 2021; 2102ORE5C6, 2021 (COVID-19); 2202ORLIEA, 2022 Compliance Requirement: Cash Management Type of Finding: Significant Deficiency; Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR ? 200.305(b), (b)(1); 2 CFR ? 200.508 Federal regulations require that auditees maintain documentation as needed for the performance of audit procedures related to the Single Audit. Additionally, regulations require payment advances should be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the subrecipient for carrying out the approved program. We reviewed 60 sample cash draws and were unable to obtain adequate supporting documentation for 4 subrecipient requests for reimbursement/advances demonstrating they were appropriate and for immediate cash needs. We also identified an advance payment for which there was not an adequate explanation indicating why an advance was needed. These 5 exceptions totaled $124,304 in expenditures. Department management cited a breakdown in control process and communicated their intention to train relevant staff to ensure adequate support is obtained. Without adequate verification of cash needs, the department could be sending funds to subrecipients that are not for a reimbursement of expenditures or immediate cash needs. We recommend department management strengthen internal controls to ensure support for subrecipient requests for funds adequately documents they are appropriate and for immediate cash needs.
MATERIAL WEAKNESSES Finding 2022-001 Criteria: According to- 2 CFR 200.508(a) The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards (SEFA) in accordance with 2 CFR 200.510. As instructed in the OMB Compliance Supplement, Provider Relief Funds (PRF) should be reported on the SEFA based upon the PRF report that is required to be submitted to the HRSA reporting portal. For example, PRF funds received in period 2 (July 1, 2020 to December 31, 2020) should be reported on the SEFA for fiscal year ends of December 31, 2021 through December 31, 2022. Condition: Federal awards totaling $332,841, including Provider Relief Funds received in period 2 of $178,159, were excluded from the SEFA. Cause: Crossroads had significant turnover within the accounting department and the new personnel had not been aware of the PRF funds received in a prior fiscal year. In addition, there was no overlap in the CFO position to provide for a smooth transition. Effect: An audit adjustment was made to report the three awards on the SEFA totaling $332,841. Recommendation: We recommend that Crossroads retain documentation regarding the information used to prepare the SEFA, along with notes for future years to assist with future personnel transitions. View of responsible officials: See attached corrective action plan.
MATERIAL WEAKNESSES Finding 2022-001 Criteria: According to- 2 CFR 200.508(a) The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards (SEFA) in accordance with 2 CFR 200.510. As instructed in the OMB Compliance Supplement, Provider Relief Funds (PRF) should be reported on the SEFA based upon the PRF report that is required to be submitted to the HRSA reporting portal. For example, PRF funds received in period 2 (July 1, 2020 to December 31, 2020) should be reported on the SEFA for fiscal year ends of December 31, 2021 through December 31, 2022. Condition: Federal awards totaling $332,841, including Provider Relief Funds received in period 2 of $178,159, were excluded from the SEFA. Cause: Crossroads had significant turnover within the accounting department and the new personnel had not been aware of the PRF funds received in a prior fiscal year. In addition, there was no overlap in the CFO position to provide for a smooth transition. Effect: An audit adjustment was made to report the three awards on the SEFA totaling $332,841. Recommendation: We recommend that Crossroads retain documentation regarding the information used to prepare the SEFA, along with notes for future years to assist with future personnel transitions. View of responsible officials: See attached corrective action plan.
MATERIAL WEAKNESSES Finding 2022-001 Criteria: According to- 2 CFR 200.508(a) The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards (SEFA) in accordance with 2 CFR 200.510. As instructed in the OMB Compliance Supplement, Provider Relief Funds (PRF) should be reported on the SEFA based upon the PRF report that is required to be submitted to the HRSA reporting portal. For example, PRF funds received in period 2 (July 1, 2020 to December 31, 2020) should be reported on the SEFA for fiscal year ends of December 31, 2021 through December 31, 2022. Condition: Federal awards totaling $332,841, including Provider Relief Funds received in period 2 of $178,159, were excluded from the SEFA. Cause: Crossroads had significant turnover within the accounting department and the new personnel had not been aware of the PRF funds received in a prior fiscal year. In addition, there was no overlap in the CFO position to provide for a smooth transition. Effect: An audit adjustment was made to report the three awards on the SEFA totaling $332,841. Recommendation: We recommend that Crossroads retain documentation regarding the information used to prepare the SEFA, along with notes for future years to assist with future personnel transitions. View of responsible officials: See attached corrective action plan.
2022 002 Assistance Listing Number, Federal Agency, and Program Name 93.498, Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution Federal Award Identification Number and Year N/A Pass through Entity N/A Finding Type Significant deficiency Repeat Finding No Criteria Per 2 CFR 200.508(b), an auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards, in accordance with 200.510 financial statements. Per 2 CFR 200.510(b), 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. Additionally, per the frequently asked questions published by HRSA, and in conjunction with the compliance supplement issued by the office of management and budget, recipients with fiscal year ends of June 30, 2021 should report the total expenditures from the Period 1 provider relief fund portal submission on the SEFA. Condition The Corporation did not prepare a complete and accurate SEFA for the year ended June 30, 2021. Questioned Costs N/A Identification of How Questioned Costs Were Computed N/A Context The Corporation's SEFA was understated for the year ended June 30, 2021 by $1,271,104. Management has acknowledged the SEFA was understated for 2021. The SEFA for June 30, 2022 is complete and accurate. Cause and Effect Management of the Corporation misunderstood guidance regarding preparation of the SEFA for the year ended June 30, 2021, resulting in the SEFA being incomplete for the year ended June 30, 2021. The $1,271,104 of funds not reported on the 2021 SEFA have been included on the SEFA for the year ended June 30, 2022. Recommendation Management should continue to monitor the SEFA reporting requirements issued by OMB and ensure all federal funding received is properly included on the SEFA in the proper period. Views of Responsible Officials and Corrective Action Plan While technically considered a significant deficiency and audit finding in accordance with CFR guidance for federal award audit compliance purposes, management considers this finding to be an isolated incident. Management had prepared and provided a SEFA summary that properly identified all federal funding, including all of the CARES Act funding, received as of June 30, 2021. Management also prepared and provided information regarding amounts of the CARES Act funding expended and recognized as revenue within the financial statements for the years ended June 30, 2020 and 2021. However, there was interpretation that the amount that was supposed to be reported for the CARES Act funding on the SEFA for the period ended June 30, 2021, should be the amount expended and recognized as revenue as of the financial statements ended June 30, 2020, to align with the Period 1 portal reporting. As such, the amount reported for the final SEFA used for the June 30, 2021 compliance audit excluded $1,271,104 that was appropriately reported as deferred grant revenue liability as of June 30, 2020. The amount of CARES Act funding for the Period 1 portal reporting correctly included the $1,271,104. There was a significant amount of collective confusion regarding the Period 1 CARES Act portal reporting which was for the period ended June 30, 2020, in relation to the SEFA reporting and compliance audit reporting for that same period of time, which was unusually deferred by the federal government from June 30, 2020 to June 30, 2021. The results of the auditors procedures demonstrated that all the information management populated in the CARES Act portal for the June 30, 2020 reporting compliance Period 1 was accurate and that there were no other findings.
Receivables not accrued for reimbursement grants subject to Uniform Guidance and the tracking of federal grant expenditures was not sufficient so that an accurate Schedule of Federal Expenditures (SEFA) could be prepared by the School (Significant Deficiency in Controls and Non-compliance) Condition: Vision Preparatory Charter School, Inc. tracked grant expenditures paid for several federal grants subject to Uniform Guidance by the date the reimbursement request was submitted instead of by the date the expenditure was paid and eligible for reimbursement. As a result of grant reimbursement requests not being properly accrued, the SEFA was understated by $35,580 for the Education Stabilization Fund Program. Also, the schedule did not include all ALN numbers. Criteria: Uniform Guidance requires the SEFA be prepared using eligible expenditures paid in the reporting year for federal funds subject to the Uniform Guidance. CFR Part 200.508 Auditee responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list the individual Federal Awards by Federal Agency, including the Federal Awards expended, name of passthrough entity, ALN number, and total amount provided to recipients. The information contained in the Schedule of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements.Cause: The School tracked the federal funds expenditures on a reimbursement request basis rather than an eligibility/paid basis and did not reconcile the amounts reported on the Schedule of Federal Awards with the amounts reported in the School’s general ledger. Effect: Receivables were not accrued for these expenditures and the Schedule of Federal Expenditures prepared by the School did not reflect all of the expenditures paid in the fiscal year ended June 30, 2022 and the Schedule of Federal Awards was incorrectly prepared. Questioned Cost: None Context: The SEFA presented for audit was understated by $35,580 for the major program audited (Education Stabilization Fund Grant). Recommendation: We recommend the School track the expenditures in Quickbooks as the expenditures are paid and we recommend the School record receivables for all of the qualifying expenditures paid but not reimbursed by year end and reconcile the Schedule of Federal Awards with the general ledger.
Receivables not accrued for reimbursement grants subject to Uniform Guidance and the tracking of federal grant expenditures was not sufficient so that an accurate Schedule of Federal Expenditures (SEFA) could be prepared by the School (Significant Deficiency in Controls and Non-compliance) Condition: Vision Preparatory Charter School, Inc. tracked grant expenditures paid for several federal grants subject to Uniform Guidance by the date the reimbursement request was submitted instead of by the date the expenditure was paid and eligible for reimbursement. As a result of grant reimbursement requests not being properly accrued, the SEFA was understated by $35,580 for the Education Stabilization Fund Program. Also, the schedule did not include all ALN numbers. Criteria: Uniform Guidance requires the SEFA be prepared using eligible expenditures paid in the reporting year for federal funds subject to the Uniform Guidance. CFR Part 200.508 Auditee responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list the individual Federal Awards by Federal Agency, including the Federal Awards expended, name of passthrough entity, ALN number, and total amount provided to recipients. The information contained in the Schedule of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements.Cause: The School tracked the federal funds expenditures on a reimbursement request basis rather than an eligibility/paid basis and did not reconcile the amounts reported on the Schedule of Federal Awards with the amounts reported in the School’s general ledger. Effect: Receivables were not accrued for these expenditures and the Schedule of Federal Expenditures prepared by the School did not reflect all of the expenditures paid in the fiscal year ended June 30, 2022 and the Schedule of Federal Awards was incorrectly prepared. Questioned Cost: None Context: The SEFA presented for audit was understated by $35,580 for the major program audited (Education Stabilization Fund Grant). Recommendation: We recommend the School track the expenditures in Quickbooks as the expenditures are paid and we recommend the School record receivables for all of the qualifying expenditures paid but not reimbursed by year end and reconcile the Schedule of Federal Awards with the general ledger.
Receivables not accrued for reimbursement grants subject to Uniform Guidance and the tracking of federal grant expenditures was not sufficient so that an accurate Schedule of Federal Expenditures (SEFA) could be prepared by the School (Significant Deficiency in Controls and Non-compliance) Condition: Vision Preparatory Charter School, Inc. tracked grant expenditures paid for several federal grants subject to Uniform Guidance by the date the reimbursement request was submitted instead of by the date the expenditure was paid and eligible for reimbursement. As a result of grant reimbursement requests not being properly accrued, the SEFA was understated by $35,580 for the Education Stabilization Fund Program. Also, the schedule did not include all ALN numbers. Criteria: Uniform Guidance requires the SEFA be prepared using eligible expenditures paid in the reporting year for federal funds subject to the Uniform Guidance. CFR Part 200.508 Auditee responsibilities state that the auditee must prepare the Schedule of Expenditures of Federal Awards, which must list the individual Federal Awards by Federal Agency, including the Federal Awards expended, name of passthrough entity, ALN number, and total amount provided to recipients. The information contained in the Schedule of Federal Awards should be derived from and relate directly to the underlying accounting and other records used to prepare the financial statements.Cause: The School tracked the federal funds expenditures on a reimbursement request basis rather than an eligibility/paid basis and did not reconcile the amounts reported on the Schedule of Federal Awards with the amounts reported in the School’s general ledger. Effect: Receivables were not accrued for these expenditures and the Schedule of Federal Expenditures prepared by the School did not reflect all of the expenditures paid in the fiscal year ended June 30, 2022 and the Schedule of Federal Awards was incorrectly prepared. Questioned Cost: None Context: The SEFA presented for audit was understated by $35,580 for the major program audited (Education Stabilization Fund Grant). Recommendation: We recommend the School track the expenditures in Quickbooks as the expenditures are paid and we recommend the School record receivables for all of the qualifying expenditures paid but not reimbursed by year end and reconcile the Schedule of Federal Awards with the general ledger.
Assistance Listing, Federal Agency, and Program Name - Assistance Listing 66.443, Environmental Protection Agency, Reducing Lead in Drinking Water Federal Award Identification Number and Year - OOE02968, 2021 Pass-through Entity - n/a Finding Type - Material weakness Repeat Finding - No Criteria - 2 CFR 200.508 requires the City to prepare appropriate financial statements, including the schedule of expenditures of federal awards (SEFA) in accordance with 2 CFR 200.510. The SEFA must list individual federal programs as required by 2 CFR 200.501(b)(1). The SEFA is the basis for the auditor determination of major programs as required by 2 CFR 200.518. Condition - The original SEFA prepared for audit purposes did not include all federal expenditures that should have been reported under ALN 66.443. Questioned Costs - None Identification of How Questioned Costs Were Computed - n/a Context - Approximately $864,000 of federal expenditures were not included in the original SEFA prepared for audit purposes under ALN 66.443. Cause and Effect - The City's controls over reconciling the SEFA to federal revenue did not detect the missing expenditures because federal revenue was not appropriately accrued by $864,000. As a result, ALN 66.443 was not originally identified as a major program. Recommendation - The City should review its controls over preparation of the SEFA and reconciling the SEFA to federal expenditures per the general ledger to ensure the appropriate amount of federal expenditures are reported on the SEFA. Views of Responsible Officials and Corrective Action Plan - We agree with the auditor’s recommendation. Changes have been implemented to ensure all programs with both federal and state/local funding will be examined to ensure correct expenditure by funding source is properly recorded.
Program - Various, including AL 10.923 – Emergency Watershed Protection Program – Reporting Grant Number & Year - Various, including NR216526XXXXC004, December 7, 2020, through August 6, 2021 Federal Grantor Agency - Various, including U.S. Department of Agriculture Pass-Through Entity - Various Criteria - Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.510(b) (January 1, 2022) states, in part, the following: 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. 2 CFR § 200.512(a)(1) (January 1, 2022) states the following: The audit must be completed and the data collection form described in paragraph (b) ofthis section and reporting package described in paragraph (c) of this section must besubmitted within the earlier of 30 calendar days after receipt of the auditor’s report(s),or nine months after the end of the audit period. If the due date falls on a Saturday,Sunday, or Federal holiday, the reporting package is due the next business day. 2 CFR § 200.508 (January 1, 2022) states, in part, the following: The auditee must: (a) Procure or otherwise arrange for the audit required by this part in accordance with §200.509, and ensure it is properly performed and submitted when due in accordance with §200.512. 2 CFR § 200.303 (January 1, 2022) states the following, in relevant part: The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ‘‘Standards for Internal Control in the Federal Government’’ issued by the Comptroller General of the United States or the ‘‘Internal Control Integrated Framework’’, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). A good internal control plan requires adequate procedures to ensure the Schedule of Expenditures Federal Awards (SEFA) is presented properly and includes all Federal expenditures made by the County during the fiscal year. Additionally, those same procedures should ensure the Federal audit is completed and submitted to the Federal Audit Clearinghouse within the time frame required by Title 2 CFR § 200.512. Condition - The County did not have adequate procedures in place to monitor Federal expenditures and ensure the Schedule of Expenditures of Federal Awards (SEFA) was completed and submitted to the Federal Audit Clearinghouse in accordance with Title 2 CFR § 200.512. Repeat Finding - No Questioned Costs - None Statistical Sample - No Context - The County had a basic financial statement audit completed for the fiscal year ending June 30, 2022, which was issued on January 4, 2023, but that audit did not include the additional information necessary to meet Uniform Guidance and Single Audit Act requirements. When the audit for the fiscal year ending June 30, 2023, was completed, the Auditor of Public Accounts identified that the County should have had a Single Audit completed for the fiscal year ending June 30, 2022. Cause - Administration of Federal awards is decentralized, with each County office operating independently without any centralized reporting procedures in place to ensure all Federal expenditures of the County are reported accurately during the annual financial statement audit. Additionally, there is an overall lack of knowledge by County personnel related to Federal reporting requirements. Effect - Noncompliance with Federal regulations and an increased risk for the SEFA to be inaccurate, which could lead to Federal sanctions and Single Audits not being completed when required. Recommendation - We recommend the County establish written procedures to ensure the SEFA is complete and accurate. Such procedures may include, among other things, a requirement that all offices in the County responsible for administering Federal grants report their grant expenditures, as well as related information, to a single individual in the County with overall responsibility for Federal reporting requirements. That individual should be knowledgeable of all Federal reporting and compliance requirements, and review expenditures provided by each office to ensure all amounts are accurate and include all Federal expenditures of the County. Further, we recommend the County obtain necessary training related to Federal reporting requirements and ensure a Single Audit is completed and submitted to the Federal Audit Clearinghouse within the time frame required by Title 2 CFR § 200.512. View of Officials - The County will ensure County personnel obtain training to ensure there is a proper understanding of the Federal reporting requirements and preparation of the Schedule of Federal Awards.
2022-001. US Department of AgricultureSchool Food Service Program CFDA No. 10.553, 10.555, and 10.559 (repeat finding #2016-1 and #2017-1 from prior years).Criteria: 2 CFR ?200.508(a) requires the auditee to ensure that an audit is properly performed and submitted when due in accordance with ? 200.512(a)(1) Report submission.Condition: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did submit the annual report on a timely basis.Questioned Costs: None.Effect: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did fulfill its requirement of timely submission of the annual reports.Context: Previous period audits of the timing of submittal of the audit report indicated that those reports were not submitted on a timely basis.Auditor?s Recommendation: Yeshiva Imrei Chaim Viznitz - School Food Service Program should maintain its newly established procedures to ensure that all future reports can be submitted on a timely basis as was done this year.Views of the responsible officials and planned corrective actions: Management has successfully implemented procedures which ensure that reports are submitted on a timely basis. While procedures were instituted in the preceding reporting period to eliminate the causes of previous period delays, new issues related to ongoing Covid-19 restrictions cropped up which inhibited the timely filing of the aforementioned period?s reports. Management tweaked the reporting process in the previous period in order to account for those obstacles as well. As such, Management is able to submit the report for 6/30/2022 in a timely manner, by 3/31/2023 or earlier.
2022-001. US Department of AgricultureSchool Food Service Program CFDA No. 10.553, 10.555, and 10.559 (repeat finding #2016-1 and #2017-1 from prior years).Criteria: 2 CFR ?200.508(a) requires the auditee to ensure that an audit is properly performed and submitted when due in accordance with ? 200.512(a)(1) Report submission.Condition: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did submit the annual report on a timely basis.Questioned Costs: None.Effect: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did fulfill its requirement of timely submission of the annual reports.Context: Previous period audits of the timing of submittal of the audit report indicated that those reports were not submitted on a timely basis.Auditor?s Recommendation: Yeshiva Imrei Chaim Viznitz - School Food Service Program should maintain its newly established procedures to ensure that all future reports can be submitted on a timely basis as was done this year.Views of the responsible officials and planned corrective actions: Management has successfully implemented procedures which ensure that reports are submitted on a timely basis. While procedures were instituted in the preceding reporting period to eliminate the causes of previous period delays, new issues related to ongoing Covid-19 restrictions cropped up which inhibited the timely filing of the aforementioned period?s reports. Management tweaked the reporting process in the previous period in order to account for those obstacles as well. As such, Management is able to submit the report for 6/30/2022 in a timely manner, by 3/31/2023 or earlier.
2022-001. US Department of AgricultureSchool Food Service Program CFDA No. 10.553, 10.555, and 10.559 (repeat finding #2016-1 and #2017-1 from prior years).Criteria: 2 CFR ?200.508(a) requires the auditee to ensure that an audit is properly performed and submitted when due in accordance with ? 200.512(a)(1) Report submission.Condition: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did submit the annual report on a timely basis.Questioned Costs: None.Effect: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did fulfill its requirement of timely submission of the annual reports.Context: Previous period audits of the timing of submittal of the audit report indicated that those reports were not submitted on a timely basis.Auditor?s Recommendation: Yeshiva Imrei Chaim Viznitz - School Food Service Program should maintain its newly established procedures to ensure that all future reports can be submitted on a timely basis as was done this year.Views of the responsible officials and planned corrective actions: Management has successfully implemented procedures which ensure that reports are submitted on a timely basis. While procedures were instituted in the preceding reporting period to eliminate the causes of previous period delays, new issues related to ongoing Covid-19 restrictions cropped up which inhibited the timely filing of the aforementioned period?s reports. Management tweaked the reporting process in the previous period in order to account for those obstacles as well. As such, Management is able to submit the report for 6/30/2022 in a timely manner, by 3/31/2023 or earlier.
2022-001. US Department of AgricultureSchool Food Service Program CFDA No. 10.553, 10.555, and 10.559 (repeat finding #2016-1 and #2017-1 from prior years).Criteria: 2 CFR ?200.508(a) requires the auditee to ensure that an audit is properly performed and submitted when due in accordance with ? 200.512(a)(1) Report submission.Condition: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did submit the annual report on a timely basis.Questioned Costs: None.Effect: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did fulfill its requirement of timely submission of the annual reports.Context: Previous period audits of the timing of submittal of the audit report indicated that those reports were not submitted on a timely basis.Auditor?s Recommendation: Yeshiva Imrei Chaim Viznitz - School Food Service Program should maintain its newly established procedures to ensure that all future reports can be submitted on a timely basis as was done this year.Views of the responsible officials and planned corrective actions: Management has successfully implemented procedures which ensure that reports are submitted on a timely basis. While procedures were instituted in the preceding reporting period to eliminate the causes of previous period delays, new issues related to ongoing Covid-19 restrictions cropped up which inhibited the timely filing of the aforementioned period?s reports. Management tweaked the reporting process in the previous period in order to account for those obstacles as well. As such, Management is able to submit the report for 6/30/2022 in a timely manner, by 3/31/2023 or earlier.
2022-001. US Department of AgricultureSchool Food Service Program CFDA No. 10.553, 10.555, and 10.559 (repeat finding #2016-1 and #2017-1 from prior years).Criteria: 2 CFR ?200.508(a) requires the auditee to ensure that an audit is properly performed and submitted when due in accordance with ? 200.512(a)(1) Report submission.Condition: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did submit the annual report on a timely basis.Questioned Costs: None.Effect: Yeshiva Imrei Chaim Viznitz ? School Food Service Program did fulfill its requirement of timely submission of the annual reports.Context: Previous period audits of the timing of submittal of the audit report indicated that those reports were not submitted on a timely basis.Auditor?s Recommendation: Yeshiva Imrei Chaim Viznitz - School Food Service Program should maintain its newly established procedures to ensure that all future reports can be submitted on a timely basis as was done this year.Views of the responsible officials and planned corrective actions: Management has successfully implemented procedures which ensure that reports are submitted on a timely basis. While procedures were instituted in the preceding reporting period to eliminate the causes of previous period delays, new issues related to ongoing Covid-19 restrictions cropped up which inhibited the timely filing of the aforementioned period?s reports. Management tweaked the reporting process in the previous period in order to account for those obstacles as well. As such, Management is able to submit the report for 6/30/2022 in a timely manner, by 3/31/2023 or earlier.
Condition: The Single Audit reporting package, as defined and required in 2 CRF 200.512 for fiscal year ended June 30, 2022, was not submitted timely. Context: Despite the Municipality’s best efforts to provide, on a timely basis, the information needed to complete the preparation and subsequent audit of their financial statements, the effects of the major disaster area declaration due to Hurricane Fiona delayed the submission of the Single Audit reporting package of the current year. Criteria: As per 2 CRF 200.512, the audit, data collection form, and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report, or nine months after the end of the audit period. However, for any 2022 submissions with fiscal periods ending between January 1, 2022, and October 31, 2022, the requirement stating that single audits are due to the Federal Audit Clearinghouse 30 days after receipt of the auditor’s report(s), is waived. These audits will be considered on time if they are submitted within nine months after their fiscal period end date. Cause: On September 18, 2022, Puerto Rico was declared a major disaster area due to the passage of Hurricane Fiona. As a result of this declaration, the OMB granted a six-month extension for all single audits that cover recipients in Puerto Rico and have due dates between September 18, 2022 and December 31, 2022. For June 30, 2021, the extended due date was March 31, 2023. The Municipality benefited from this extension and submitted their financial statements and data collection form on March 17, 2023. The due date of the current fiscal year, June 30, 2022 however was not extended and was also due on March 31, 2023. This situation prevented the timely submission of the current fiscal year Single Audit reporting package. Effect: Because of the situation described above, the Municipality did not comply with the report submission requirement since the audit was not submitted within nine months after their fiscal period end date. Auditor’s recommendation: Management should continue to fulfill their auditee responsibilities as stated in 2 CRF 200.508 which among other things, require management to prepare appropriate financial statements and provide the auditor with access to personnel, accounts, books, records, supporting documentation, and other information as needed for the auditor to perform the audit to ensure that subsequent financial reporting packages are submitted timely. Views of Responsible officials and corrective actions: The Municipality Administration is committed to complying with all submissions and has ensured the proper signing of an external auditors firm to comply with such requirements. Auditor Comments: 2 CFR 200.501 states that a non-federal entity that expends $750,000 or more in Federal awards during the non-Federal entity’s fiscal year must have a single audit conducted in accordance with 2 CFR 200.514. 2 CFR 200.508 states that it is the auditee responsibility to (1) prepare financial statements, including, the schedule of expenditures of Federal awards in accordance with 2 CFR 200.510, (2) promptly follow up and take corrective action on audit findings, including preparing a summary schedule of prior audit findings and a corrective plan, and (3) provide the auditor access to personnel, accounts, books, records, supporting documentation, and any other information needed for the auditor to perform the audit required by this part, among other things. Audit Status: In process of completion.
ALN 84.425 Elementary and Secondary School Emergency Fund Program United States Department of Education Passed through State of Louisiana Department of Education 2022 Funding Criteria: In accordance with 2 CFR Part 200.303(a), the School must establish, document, and maintain effective internal control over Federal awards that provide reasonable assurance that the recipient of subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. In addition, 2 CFR 200.508(d) requires that the auditee ‘provide the auditor access to personnel, accounts, books, records, supporting documentation, and any other information needed for the auditor to perform the audit required by this part.’ Condition: The School did not maintain documentation for amounts submitted for reimbursement through the program. As a result, we were unable to obtain sufficient, appropriate audit evidence to support $111,006, or approximately 25%, of the total expenditures reimbursed under the Education Stabilization Fund during the year ended June 30, 2022. Thus, we were unable to form a conclusion on the School’s compliance with direct and material requirements for a material portion of Federal award expenditures. Cause: The change in key finance department personnel caused misplacement of some of the documentation supporting the program expenditures. Effect: Amounts could be reimbursed that are not properly supported and the federal agency could request repayment of the unsupported reimbursement amounts. Questioned Costs: None Recommendation: We recommend that the School revise and implement controls to ensure consistent maintenance of all supporting documentation even if there are changes in personnel. Management Response: See corrective action plan on page 33.
ALN 84.425 Elementary and Secondary School Emergency Fund Program United States Department of Education Passed through State of Louisiana Department of Education 2022 Funding Criteria: In accordance with 2 CFR Part 200.303(a), the School must establish, document, and maintain effective internal control over Federal awards that provide reasonable assurance that the recipient of subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. In addition, 2 CFR 200.508(d) requires that the auditee ‘provide the auditor access to personnel, accounts, books, records, supporting documentation, and any other information needed for the auditor to perform the audit required by this part.’ Condition: The School did not maintain documentation for amounts submitted for reimbursement through the program. As a result, we were unable to obtain sufficient, appropriate audit evidence to support $111,006, or approximately 25%, of the total expenditures reimbursed under the Education Stabilization Fund during the year ended June 30, 2022. Thus, we were unable to form a conclusion on the School’s compliance with direct and material requirements for a material portion of Federal award expenditures. Cause: The change in key finance department personnel caused misplacement of some of the documentation supporting the program expenditures. Effect: Amounts could be reimbursed that are not properly supported and the federal agency could request repayment of the unsupported reimbursement amounts. Questioned Costs: None Recommendation: We recommend that the School revise and implement controls to ensure consistent maintenance of all supporting documentation even if there are changes in personnel. Management Response: See corrective action plan on page 33.
ALN 84.425 Elementary and Secondary School Emergency Fund Program United States Department of Education Passed through State of Louisiana Department of Education 2022 Funding Criteria: In accordance with 2 CFR Part 200.303(a), the School must establish, document, and maintain effective internal control over Federal awards that provide reasonable assurance that the recipient of subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. In addition, 2 CFR 200.508(d) requires that the auditee ‘provide the auditor access to personnel, accounts, books, records, supporting documentation, and any other information needed for the auditor to perform the audit required by this part.’ Condition: The School did not maintain documentation for amounts submitted for reimbursement through the program. As a result, we were unable to obtain sufficient, appropriate audit evidence to support $111,006, or approximately 25%, of the total expenditures reimbursed under the Education Stabilization Fund during the year ended June 30, 2022. Thus, we were unable to form a conclusion on the School’s compliance with direct and material requirements for a material portion of Federal award expenditures. Cause: The change in key finance department personnel caused misplacement of some of the documentation supporting the program expenditures. Effect: Amounts could be reimbursed that are not properly supported and the federal agency could request repayment of the unsupported reimbursement amounts. Questioned Costs: None Recommendation: We recommend that the School revise and implement controls to ensure consistent maintenance of all supporting documentation even if there are changes in personnel. Management Response: See corrective action plan on page 33.
Condition: During our review and reconciliation of the Schedule of Expenditures of Federal Awards (SEFA) as initially prepared by the County, we identified federal programs that were not listed accurately which resulted in federal expenditures being overstated stated by $2,412,977. • Expenditures reported on the SEFA for ALN 16.607 - Bulletproof Vest Partnership Program were $36,810. Actual federal expenditures obtained from the County’s records confirm $0 expended for a variance of $36,810. • Expenditures reported on the SEFA for ALN 21.019 - Coronavirus Relief Fund were $2,376,264. Actual federal expenditures obtained from the County’s records confirm $0 expended for a variance of $2,376,264. Expenditures reported on the SEFA for ALN 97.042 - Emergency Management Performance Grants were $24,864. Actual federal expenditures obtained from the County’s records confirm $24,961 expended for a variance of ($97). Additionally, the County failed to present $500,000 in subrecipient expenditures on the SEFA for ALN 21.027 - Coronavirus State and Local Fiscal Recovery Funds. Cause of Condition: Policies and procedures have not been designed and implemented to ensure accurate reporting of expenditures for all federal awards. Effect of Condition: This condition resulted in inaccurate recording of the federal expenditures on the SEFA. Recommendation: OSAI recommends county officials and department heads gain an understanding of federal programs awarded to Rogers County. Internal control procedures should be designed and implemented to ensure accurate reporting of expenditures on the SEFA and to ensure compliance with federal requirements. The Board of County Commissioners (BOCC) should review and approve the SEFA in an open meeting. Management Response: Board of County Commissioners: The Board of County Commissioners is responsible for the overall fiscal concerns of the county. See OKLA. STAT. Title 19, § 345. The Board of County Commissioners, with the cooperation and participation of all elected officials, reviews, develops and implements policies and procedures to create a strong internal control environment. Additionally, the Board of County Commissioners conducts meetings with all elected officials and officers responsible for the receipt and/or expenditure of county funds. These meetings address fiscal matters, including but not limited to, policy discussions and implementation, financial reports, budget oversight, SEFA reporting, and legal compliance. Policies and procedures, combined with fiscal oversight meetings, are intended to: 1) prevent or detect material misstatements in the financial statements; 2) prevent or detect fraud within the county; 3) increase communication between the Board of County Commissioners and those elected officials and officers responsible for the receipt and/or expenditure of public funds; 4) provide oversight over the fiscal concerns of the county; 5) identify and address risks related to financial reporting; 6) ensure the accuracy of Rogers County’s financial statements, Estimate of Needs, and the SEFA; and 7) ensure compliance with all applicable federal and state laws, regulations, and/or codes. The Board of County Commissioners, with the cooperation of all elected officials and officers responsible for the receipt or expenditure of federal funds, will evaluate the processes and procedures currently in place to ensure the accuracy of SEFA reporting and detect potential inaccuracies and/or misstatements. Criteria: 2 CFR § 200.303(a) Internal Controls reads as follows: The non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR § 200.508(b) Auditee responsibilities reads as follows: The auditee must: Prepare appropriate financial statements, including the schedule of expenditures of Federal awards in accordance with §200.510 Financial statements. 2 CFR § 200.510(b) Financial statements reads, in part, as follows: 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. Further, GAO Standards – Section 2 – Objectives of an Entity - OV2.23 states in part: Compliance Objectives Management conducts activities in accordance with applicable laws and regulations. As part of specifying compliance objectives, the entity determines which laws and regulations apply to the entity. Management is expected to set objectives that incorporate these requirements.
Criteria: CFR Part 200.508 Auditee Responsibilities state that the auditee must prepare the schedule of expenditures of federal awards. The information contained in the schedule of expenditures of federal awards should be reconciled to the underlying accounting and other records used to prepare financial statements, such that it is a fairly stated representation of federal awards expended by their respective federal agency and CFDA number. Condition: The amount of expenditures reported for the HS/EHS program on the schedule of expenditures of federal awards had various offsetting variances, netting to total misstatement that was not considered material to the overall financial statements or to the major federal program. Individually, improper expenditures included were depreciation, expenditures covered by program income, and allocation of a workers compensation refund received to offset workers compensation expenditures. Expenditures improperly excluded were current program capital expenditures and a payroll for a pay period in which the payroll was voided and re-issued, but the re-issued payroll was excluded from the final payroll expenditures reported for the major program. Cause: The Organization does not have effective internal control processes or procedures over the preparation of the schedule of expenditures of federal awards. The Organization did not reconcile the expenditures reported on the schedule to the relevant and complete costs and grant amounts drawn down as reported on the general ledger. Effect or Potential Effect: Potential understatement or overstatement of expenditures could exist in the schedule of expenditures of federal awards and not be detected and corrected. Questioned Cost: None. Repeat of a Prior-Year Finding: No. Recommendation: The Organization should establish policies and procedures to reconcile amounts reported in the financial statements and on the schedule of expenditures of federal awards in a timely manner after the period-end. Accounting personnel should take relevant training in the preparation of financial statements and the schedule of expenditures of federal awards, with particular focus on costs to be included and documentation to be retained in processing grant drawdowns and in preparing reconciliations of significant accounts and grants, grant financial reporting, and the reporting of amounts on the schedule of expenditures of federal awards. The Organization should also consider contracting with an external accounting firm to help oversee the year-end close, audit preparedness, as well as grant financial reporting. Organization's Response 2022 and Corrective Action Plan: The Organization concurs with the recommendation and had already released updated financial policies and procedures as of September 2022. Further revisions will be made in 2023 and include specific instructions for particular grants including federal and state. Additional training is needed for all levels of the fiscal team as well as for program managers to better understand the fiscal requirements of each grant. It is acknowledged that the fiscal team must be expanded and restructured and we have already started the process of recruiting a new CFO. The new CFO will be expected to consistently maintain a comprehensive matrix including all grant requirements. During this time we are seeking a consultant to help us establish better processes, controls and systems and assist until a permanent CFO is established. Other consultants may be obtained for supportive services as needed/recommended in the future. All applicable staff (fiscal and management) will be trained regarding procedures to review grant expenditures for compliance with terms of the grant, and to maintain sufficient records that reconcile to amounts reported as grant expenditures. Further, a new accounting system, Blackbaud, with enhanced cost recording, reporting and budgeting capabilities, has been approved by our Board of Directors to be implemented at the start of the next fiscal year. This implementation includes extensive training for fiscal and program staff. The fiscal committee and the Board will receive monthly updates on the progress being made in these areas. (Current responsible party: Renee Hungerford, Executive Director/CEO) Auditor's Response to Organization's Response 2022 and Corrective Plan: We have noted the Organization's response which appears sufficient and appropriate in the circumstances, and we further note the certain referenced steps already taken in discussion with management.
Criteria: CFR Part 200.508 Auditee Responsibilities state that the auditee must prepare the schedule of expenditures of federal awards. The information contained in the schedule of expenditures of federal awards should be reconciled to the underlying accounting and other records used to prepare financial statements, such that it is a fairly stated representation of federal awards expended by their respective federal agency and CFDA number. Condition: The amount of expenditures reported for the HS/EHS program on the schedule of expenditures of federal awards had various offsetting variances, netting to total misstatement that was not considered material to the overall financial statements or to the major federal program. Individually, improper expenditures included were depreciation, expenditures covered by program income, and allocation of a workers compensation refund received to offset workers compensation expenditures. Expenditures improperly excluded were current program capital expenditures and a payroll for a pay period in which the payroll was voided and re-issued, but the re-issued payroll was excluded from the final payroll expenditures reported for the major program. Cause: The Organization does not have effective internal control processes or procedures over the preparation of the schedule of expenditures of federal awards. The Organization did not reconcile the expenditures reported on the schedule to the relevant and complete costs and grant amounts drawn down as reported on the general ledger. Effect or Potential Effect: Potential understatement or overstatement of expenditures could exist in the schedule of expenditures of federal awards and not be detected and corrected. Questioned Cost: None. Repeat of a Prior-Year Finding: No. Recommendation: The Organization should establish policies and procedures to reconcile amounts reported in the financial statements and on the schedule of expenditures of federal awards in a timely manner after the period-end. Accounting personnel should take relevant training in the preparation of financial statements and the schedule of expenditures of federal awards, with particular focus on costs to be included and documentation to be retained in processing grant drawdowns and in preparing reconciliations of significant accounts and grants, grant financial reporting, and the reporting of amounts on the schedule of expenditures of federal awards. The Organization should also consider contracting with an external accounting firm to help oversee the year-end close, audit preparedness, as well as grant financial reporting. Organization's Response 2022 and Corrective Action Plan: The Organization concurs with the recommendation and had already released updated financial policies and procedures as of September 2022. Further revisions will be made in 2023 and include specific instructions for particular grants including federal and state. Additional training is needed for all levels of the fiscal team as well as for program managers to better understand the fiscal requirements of each grant. It is acknowledged that the fiscal team must be expanded and restructured and we have already started the process of recruiting a new CFO. The new CFO will be expected to consistently maintain a comprehensive matrix including all grant requirements. During this time we are seeking a consultant to help us establish better processes, controls and systems and assist until a permanent CFO is established. Other consultants may be obtained for supportive services as needed/recommended in the future. All applicable staff (fiscal and management) will be trained regarding procedures to review grant expenditures for compliance with terms of the grant, and to maintain sufficient records that reconcile to amounts reported as grant expenditures. Further, a new accounting system, Blackbaud, with enhanced cost recording, reporting and budgeting capabilities, has been approved by our Board of Directors to be implemented at the start of the next fiscal year. This implementation includes extensive training for fiscal and program staff. The fiscal committee and the Board will receive monthly updates on the progress being made in these areas. (Current responsible party: Renee Hungerford, Executive Director/CEO) Auditor's Response to Organization's Response 2022 and Corrective Plan: We have noted the Organization's response which appears sufficient and appropriate in the circumstances, and we further note the certain referenced steps already taken in discussion with management.
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO
Finding 2021-003: Reconciliation of Accounts Material Weakness Federal Programs: Research and Development Cluster: 47.076 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): 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. Condition: The year-end schedules for federal grants receivable, and for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Cause: Errors in transferring balances between years occurred, which impacted carry-over amounts and the ending balances as of 12/31/2021. Related to vacation payables, the schedule had not been properly adjusted to account for the number of days in the last pay period. Effect or Potential Effect: Three federal grant accounts were overdrawn as of 12/31/2021, creating a liability to the federal government. The related grant receivable and liability balances were not properly stated before adjustment as a result. Questioned Costs: $80,978. Identification as a Repeat Finding, if Applicable: 2020-003 Recommendation: We recommend AAPT staff prepare schedules used to prepare entries into the accounting information system or which the information in the schedules will otherwise be used to initiate financial transactions, and the transactions and schedules be reviewed by a supervisor. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $80,978 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by July 31,2024. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: 05/01/2024 Responsible Official: Michael Brosnan, CFO