Data collection to be completed timely Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and 84.367, Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Federal Award Identification Number and Year: 213713 & 240520 Pass-through Entity: Michigan Department of Education Finding Type: Material weakness over compliance and internal controls over compliance Criteria: Per 2 CFR 200.512(a)(1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501(b), a non Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with§ 200.514. Condition: The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Cause: The Academy's books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect: Data collection forms were not submitted on time. Recommendation: We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of responsible officials and planned corrective action plan: Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 and 2024 fiscal year were not reconciled or closed in a timely manner. The data collection forms were not submitted within the required time. Effect – Data collection forms were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund and Assistance Listing Number 84.010A, Department of Education, Title I Grants to Local Educational Agencies Federal Award Identification Number and Year: 213716, 231530 and 241530 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form were not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Finding 2024-001 Reporting - Significant Deficiency in Internal Control Over Compliance Agency Department of Treasury Assistance Listing Numbers (ALN) 21.027 Program Name COVID-19 – Coronavirus State and Local Fiscal Recovery Fund Award Year 2022 Pass-Through Agency State of Alaska Department of Commerce, Community and Economic Development Pass-Through Entity Identifying Number AK0128 Criteria or Specific Requirement 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards to provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. 2 CFR section 200.514 requires auditors to obtain an understanding of the non-federal entity’s internal control over federal programs sufficient to plan the audit to support a low assessed level of control risk of noncompliance, which includes inspection of evidence of operation of those controls. Condition There was insufficient evidence retained to document operation of reporting controls, to include review or approval of the report filed. Cause This particular grant operated differently than is typical for the City, as it was not managed by a separate department. Effect or Potential Effect Information submitted to the granting agency could be incomplete or inaccurate. Questioned costs None. Context The auditor selected the annual report for testing. The report was completed and submitted by the Finance Director, but no evidence of review was maintained. The report was retained in the grant file and available for testing, and management asserts the submission was discussed at in-person meetings. The expenditures included on the report are tracked and approved separately. Identification as a repeat finding Not a repeat finding. Recommendation We recommend management retain evidence of internal control procedures around reporting to show review. Views of Responsible Officials Management agrees with this finding and has revised their policies and procedures to improve review and approval of grant reports submitted.
Federal Agency: U.S. Department of Education Federal Program Title: Education Stabilization Fund (ESF) FAL Number: 84.425U Pass-Through Agency: California Department of Education Pass-Through Number: 15559, 10155 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Reporting Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the Organization reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $1,383,405 in expenditures over actual expenditures for 4 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the Organization design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the Organization will have the opportunity to correct the reporting errors in the subsequent periods.
Federal Agency: U.S. Department of Education Federal Program Title: Education Stabilization Fund (ESF) FAL Number: 84.425U Pass-Through Agency: California Department of Education Pass-Through Number: 15559, 10155 Award Period: July 1, 2022 – June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Reporting Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the Organization reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $1,383,405 in expenditures over actual expenditures for 4 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the Organization design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the Organization will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Criteria or specific requirement: Per 2 CFR section 200.514, in assessing the internal controls over reporting, it was noted an additional review of annual performance reports prior to submission was not accurately performed. Condition and Context: During the sample of 5 ESSER program annual performance reports that were tested, we noted that the School reported the full allocation of ESF funds for the year ended June 30, 2023, rather than the expenditures allocated to the program during the period. While the annual reporting was incorrect, the quarterly reporting of expenditures during the year ended June 30, 2023 were correct and expenditures for the ESF funds were recorded properly in the financial statements. Questioned Costs: No questioned costs, as quarterly report and use of expenditure by funds were accurately reported and recorded. Cause: Clerical error and lack of secondary review of inputs prior to annual performance report submissions. Effect: Over-reporting of $292,469 in expenditures over actual expenditures for 3 of the ESSER program annual performance reports. Repeat Finding: Not a repeat finding. Recommendation: We recommend the School design an additional internal control to review the annual performance reports prior to submission. Views of responsible officials and Corrective Action Plan (Unaudited): Controls will be implemented for future reporting and the School will have the opportunity to correct the reporting errors in the subsequent periods.
Program: AL 97.036 – Disaster Grants – Public Assistance (Presidentially Declared Disasters) – Subrecipient Monitoring Grant Number & Year: 4616-DR-NE, declared September 6, 2021; 4420-DR-NE, declared March 21, 2019; 4641-DR-NE, declared February 23, 2022; 4662-DR-NE, declared July 27, 2022; 4521-DR-NE, declared April 4, 2020 Federal Grantor Agency: U.S. Department of Homeland Security Criteria: 2 CFR § 200.332 (January 1, 2024) states, in relevant part, the following: All pass-through entities must: * * * * (f) Verify that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient’s Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in §200.501. 2 CFR § 200.501(b) (January 1, 2024) states, in relevant part, the following, “A non-Federal entity that expends $750,000 or more during the non-Federal entity’s fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514 . . . .” A good internal control plan includes procedures to ensure subrecipient audits are reviewed timely. Condition: The Agency did not ensure subrecipients obtained Single audits. A similar finding was noted in the prior audit. Repeat Finding: 2023-063 Questioned Costs: None Statistical Sample: No Context: We selected three subrecipients for testing that would have required a Single audit based on the amount of funds received from the Agency during the subrecipient’s previous fiscal year. One of the three subrecipients received $12,604,747 in disaster grant funds passed through the Agency during the subrecipient’s fiscal year 2023, but did not submit a Single audit and the Agency had not followed up with the subrecipient. Cause: Employee oversight. The subrecipient returned a certification stating that they did not require a Single audit, and the Agency failed to verify the certification was proper. Effect: Without adequate monitoring procedures, there is an increased risk that Federal awards could be used for unallowable costs. Recommendation: We recommend the Agency implement procedures to ensure subrecipient audits are obtained and reviewed timely. Management Response: Military (NEMA) agrees with the finding and has implemented the corrective action plan.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
Reference Number: 2024-026 Prior Year Finding: 2023-023 Federal Agency: U.S. Department of Agriculture U.S. Department of Health and Human Services State Agency: Department of Finance and Management Federal Program: SNAP Cluster Temporary Assistance for Needy Families CCDF Cluster Assistance Listing Number: 10.551, 10.561, 93.558, 93.575, 93.596 Award Number and Year: 4VT400406 (10/1/2022 – 9/30/2023) 4VT402513 (10/1/2023 – 9/30/2024) 2301VTTANF (10/1/2022 – 9/30/2023) 2401VTTANF (10/1/2023 – 9/30/2024) 2301VTCCDD (10/1/2022 – 9/30/2025) 2401VTCCDD (10/1/2023 – 9/30/2026) Compliance Requirement: Cash Management Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: US Department of the Treasury (Treasury) regulations at 31 CFR Part 205 implement the Cash Management Improvement Act of 1990 (CMIA), as amended (Pub. L. No. 101-453; 31 USC 6501 et seq.). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Assistance Listing (Catalog of federal Domestic Assistance) that meet the funding threshold for a major federal assistance program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Programs not covered by a Treasury-State Agreement are subject to procedures prescribed by Treasury in Subpart B of 31 CFR Part 205 (Subpart B), which at 31 CFR section 205.33(a) include the requirement for a state to minimize the time between the drawdown of federal funds and their disbursement for federal program purposes. Annual Reports are submitted electronically by December 31 of each year. The Annual Report includes Federal interest liabilities, State interest liabilities, and State direct cost claims. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply 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 Department of Finance and Management (Finance) improperly calculated State interest liabilities for multiple programs on the FY2024 CMIA Annual Report. Context: Finance is the entity responsible for calculation of State and Federal interest liabilities and completion of the CMIA Annual Report. The annual interest rate is established by the U.S. Treasury and published on its CMIA website. This rate must be used when calculating State and Federal interest liabilities in the Annual Report. Finance receives drawdown detail support from other State agencies which it uses to compile the State’s Annual Report submission. When Finance prepared the FY2024 Annual Report, it failed to verify that the correct interest rate was applied to calculate interest liabilities, resulting in an underreporting of the State interest liability for several programs. Specifically, we noted that the State’s interest liability was underreported for the following programs: • SNAP Cluster: $579 • Temporary Assistance for Needy Families: $2,589 • CCDF Cluster: $500 Cause: Finance’s procedures were not sufficient to ensure that the FY2024 interest rate established by the U.S. Treasury was applied for all programs when interest liabilities were calculated. Internal controls did not prevent or detect the errors. Effect: The State’s interest liability was underreported to the U.S. Treasury, resulting in the State earning interest on Federal funds to which it was not entitled. Questioned costs: $3,668, the total State interest liability that was underreported on the FY2024 CMIA Annual Report. Recommendation: We recommend that Finance review and enhance its internal controls and procedures over the CMIA Annual Report to ensure that it verifies the correct interest rate is applied and that State and Federal interest liabilities are properly calculated in accordance with 2 CFR section 200.514. Views of responsible officials: Management agrees with the finding.
MATERIAL WEAKNESSES 2024-001- EIV Forms Federal Program Information: Housing Choice Voucher Cluster: CFDA – 14.871 Housing Choice Voucher Criteria: The following CFR(s) apply to this finding: 2 CFR 200.514(c) Condition: During audit procedures, it was identified that the Montpelier Housing Authority's EIV forms for new tenants were not being completed. Cause: The Authority does not have the necessary internal controls over compliance. Effect: The Authority is not pulling EIV information from the website in a timely manner with any of their new tenants that have come to the unit. Identification of Questioned Costs: None identified. Context: 40 tenant files were pulled for review Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Montpelier Authority implement internal control processes and procedures to ensure that EIV forms are done timely Views of Responsible Officials and Corrective Action Plan: Client agrees with finding, and the unabridged version of their response can be found in the Corrective Action Plan. Please see the Corrective Action Plan issued by the Montpelier Housing Authority.
2024-018 Oregon Department of Human Services Strengthen Medicaid fraud hotline reporting mechanisms Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.777, 93.778 Medicaid Cluster Federal Award Numbers and Years: 2305OR5MAP, 2023; 2305OR5ADM, 2023; 2405OR5MAP, 2024; 2405OR05ADM, 2024 Compliance Requirements: Special Tests and Provisions Type of Finding: Significant Deficiency; Noncompliance Prior Year Findings: N/A Questioned Costs: N/A Criteria: 42 CFR 455.13(a); 42 CFR 455.14; 2 CFR 200.514 (c)(4) The state is required to have a method and criteria for identifying suspected fraud. For all suspected fraud reported the state must complete a preliminary investigation to determine whether there is sufficient basis to warrant a full investigation. The state is also required to maintain internal controls effective in preventing and/ or detecting noncompliance. To ensure adequate compliance with these requirements, the state uses a publicly available hotline portal to collect suspected fraud details. The Department of Human Services (department) manages the state’s online hotline portal and phone line. The department works collaboratively with the Oregon Heath Authority (authority) and Department of Justice (DOJ) to complete fraud investigations and referrals within their individual jurisdictions as required by standards. Referrals from the online hotline portal are extracted and then reviewed and tracked by the individual agency with appropriate jurisdiction. During inquiries and testing of the online hotline portal and phone line we noted the following: • The phone line recording provided inaccurate directions on how and where to report Medicaid fraud. The phone line instructions were not updated after changes to the department’s website, creating barriers to reporting. • The online hotline portal instructions and term definitions were vague, and not all fields were available. This could lead to a higher number of cases being closed for insufficient information. • The online hotline portal does not contain any case tracking details. As such the online hotline portal does not support any reporting to assist the department in ensuring all cases have had preliminary investigations. Without tracking details, we were unable to perform testing procedures over preliminary investigations. Per department management, the department has operated the hotline phone line and online portal for many years and strives for continuous improvement. However, management has not established procedures to ensure current systems operate in a manner that allows the agencies to meet compliance standards. We recommend department management ensure public access to provide fraud referrals is not limited and that a referral tracking mechanism is created to ensure all referrals are given preliminary investigations.
2024-018 Oregon Department of Human Services Strengthen Medicaid fraud hotline reporting mechanisms Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.777, 93.778 Medicaid Cluster Federal Award Numbers and Years: 2305OR5MAP, 2023; 2305OR5ADM, 2023; 2405OR5MAP, 2024; 2405OR05ADM, 2024 Compliance Requirements: Special Tests and Provisions Type of Finding: Significant Deficiency; Noncompliance Prior Year Findings: N/A Questioned Costs: N/A Criteria: 42 CFR 455.13(a); 42 CFR 455.14; 2 CFR 200.514 (c)(4) The state is required to have a method and criteria for identifying suspected fraud. For all suspected fraud reported the state must complete a preliminary investigation to determine whether there is sufficient basis to warrant a full investigation. The state is also required to maintain internal controls effective in preventing and/ or detecting noncompliance. To ensure adequate compliance with these requirements, the state uses a publicly available hotline portal to collect suspected fraud details. The Department of Human Services (department) manages the state’s online hotline portal and phone line. The department works collaboratively with the Oregon Heath Authority (authority) and Department of Justice (DOJ) to complete fraud investigations and referrals within their individual jurisdictions as required by standards. Referrals from the online hotline portal are extracted and then reviewed and tracked by the individual agency with appropriate jurisdiction. During inquiries and testing of the online hotline portal and phone line we noted the following: • The phone line recording provided inaccurate directions on how and where to report Medicaid fraud. The phone line instructions were not updated after changes to the department’s website, creating barriers to reporting. • The online hotline portal instructions and term definitions were vague, and not all fields were available. This could lead to a higher number of cases being closed for insufficient information. • The online hotline portal does not contain any case tracking details. As such the online hotline portal does not support any reporting to assist the department in ensuring all cases have had preliminary investigations. Without tracking details, we were unable to perform testing procedures over preliminary investigations. Per department management, the department has operated the hotline phone line and online portal for many years and strives for continuous improvement. However, management has not established procedures to ensure current systems operate in a manner that allows the agencies to meet compliance standards. We recommend department management ensure public access to provide fraud referrals is not limited and that a referral tracking mechanism is created to ensure all referrals are given preliminary investigations.
2024-018 Oregon Department of Human Services Strengthen Medicaid fraud hotline reporting mechanisms Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.777, 93.778 Medicaid Cluster Federal Award Numbers and Years: 2305OR5MAP, 2023; 2305OR5ADM, 2023; 2405OR5MAP, 2024; 2405OR05ADM, 2024 Compliance Requirements: Special Tests and Provisions Type of Finding: Significant Deficiency; Noncompliance Prior Year Findings: N/A Questioned Costs: N/A Criteria: 42 CFR 455.13(a); 42 CFR 455.14; 2 CFR 200.514 (c)(4) The state is required to have a method and criteria for identifying suspected fraud. For all suspected fraud reported the state must complete a preliminary investigation to determine whether there is sufficient basis to warrant a full investigation. The state is also required to maintain internal controls effective in preventing and/ or detecting noncompliance. To ensure adequate compliance with these requirements, the state uses a publicly available hotline portal to collect suspected fraud details. The Department of Human Services (department) manages the state’s online hotline portal and phone line. The department works collaboratively with the Oregon Heath Authority (authority) and Department of Justice (DOJ) to complete fraud investigations and referrals within their individual jurisdictions as required by standards. Referrals from the online hotline portal are extracted and then reviewed and tracked by the individual agency with appropriate jurisdiction. During inquiries and testing of the online hotline portal and phone line we noted the following: • The phone line recording provided inaccurate directions on how and where to report Medicaid fraud. The phone line instructions were not updated after changes to the department’s website, creating barriers to reporting. • The online hotline portal instructions and term definitions were vague, and not all fields were available. This could lead to a higher number of cases being closed for insufficient information. • The online hotline portal does not contain any case tracking details. As such the online hotline portal does not support any reporting to assist the department in ensuring all cases have had preliminary investigations. Without tracking details, we were unable to perform testing procedures over preliminary investigations. Per department management, the department has operated the hotline phone line and online portal for many years and strives for continuous improvement. However, management has not established procedures to ensure current systems operate in a manner that allows the agencies to meet compliance standards. We recommend department management ensure public access to provide fraud referrals is not limited and that a referral tracking mechanism is created to ensure all referrals are given preliminary investigations.
2024-018 Oregon Department of Human Services Strengthen Medicaid fraud hotline reporting mechanisms Federal Awarding Agency: U.S. Department of Health and Human Services Assistance Listing Number and Name: 93.777, 93.778 Medicaid Cluster Federal Award Numbers and Years: 2305OR5MAP, 2023; 2305OR5ADM, 2023; 2405OR5MAP, 2024; 2405OR05ADM, 2024 Compliance Requirements: Special Tests and Provisions Type of Finding: Significant Deficiency; Noncompliance Prior Year Findings: N/A Questioned Costs: N/A Criteria: 42 CFR 455.13(a); 42 CFR 455.14; 2 CFR 200.514 (c)(4) The state is required to have a method and criteria for identifying suspected fraud. For all suspected fraud reported the state must complete a preliminary investigation to determine whether there is sufficient basis to warrant a full investigation. The state is also required to maintain internal controls effective in preventing and/ or detecting noncompliance. To ensure adequate compliance with these requirements, the state uses a publicly available hotline portal to collect suspected fraud details. The Department of Human Services (department) manages the state’s online hotline portal and phone line. The department works collaboratively with the Oregon Heath Authority (authority) and Department of Justice (DOJ) to complete fraud investigations and referrals within their individual jurisdictions as required by standards. Referrals from the online hotline portal are extracted and then reviewed and tracked by the individual agency with appropriate jurisdiction. During inquiries and testing of the online hotline portal and phone line we noted the following: • The phone line recording provided inaccurate directions on how and where to report Medicaid fraud. The phone line instructions were not updated after changes to the department’s website, creating barriers to reporting. • The online hotline portal instructions and term definitions were vague, and not all fields were available. This could lead to a higher number of cases being closed for insufficient information. • The online hotline portal does not contain any case tracking details. As such the online hotline portal does not support any reporting to assist the department in ensuring all cases have had preliminary investigations. Without tracking details, we were unable to perform testing procedures over preliminary investigations. Per department management, the department has operated the hotline phone line and online portal for many years and strives for continuous improvement. However, management has not established procedures to ensure current systems operate in a manner that allows the agencies to meet compliance standards. We recommend department management ensure public access to provide fraud referrals is not limited and that a referral tracking mechanism is created to ensure all referrals are given preliminary investigations.
MATERIAL WEAKNESSES 2024-001- EIV Forms Federal Program Information: Housing Choice Voucher Cluster: CFDA – 14.871 Housing Choice Voucher Criteria: The following CFR(s) apply to this finding: 2 CFR 200.514(c) Condition: During audit procedures, it was identified that the Montpelier Housing Authority's EIV forms for new tenants were not being completed. Cause: The Authority does not have the necessary internal controls over compliance. Effect: The Authority is not pulling EIV information from the website in a timely manner with any of their new tenants that have come to the unit. Identification of Questioned Costs: None identified. Context: 40 tenant files were pulled for review Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Montpelier Authority implement internal control processes and procedures to ensure that EIV forms are done timely Views of Responsible Officials and Corrective Action Plan: Client agrees with finding, and the unabridged version of their response can be found in the Corrective Action Plan. Please see the Corrective Action Plan issued by the Montpelier Housing Authority.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 84.425, Department of Education, Education Stabilization Fund Federal Award Identification Number and Year: 213713 Pass-through Entity – Michigan Department of Education Finding Type – Material weakness over compliance Repeat Finding - No Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended June 30, 2023. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – The Academy’s books and records for the 2023 fiscal year were not reconciled or closed in a timely manner. The data collection form was not submitted within the required time. Effect – Data collection form was not submitted on time. Recommendation – We recommend that the Academy develop a reliable system to close the financial records in a timely manner. View of Responsible Officials and Corrective Action Plan – Management agrees with the finding. See corrective action plan.
Federal Agency: United States Department of Agriculture (USDA) Federal Program: 10.558 Child and Adult Care Food Program (CACFP) 2022, 2023, 2024 - CACFP 2022, 2023, 2024 - CACFP-CIL 2023 and 2024 - CACFP-SPON State Agency: Department of Health and Senior Services (DHSS) - Bureau of Community Food and Nutrition Assistance (BCFNA) Type of Finding: A - Internal Control (Significant Deficiency) and Nonmaterial Noncompliance B - Internal Control (Material Weakness) and Material Noncompliance Questioned Costs: Unknown Compliance Requirement: Subrecipient Monitoring As noted in our previous audit, during the year ended June 30, 2024, BCFNA subrecipient risk assessment and monitoring procedures were not in compliance with subrecipient monitoring requirements and were not sufficient to ensure CACFP subrecipient compliance with program requirements. During the year ended June 30, 2024, the BCFNA disbursed approximately $67.6 million to over 780 CACFP subrecipients, which consist of child and adult care centers and sponsors of centers. Disbursements to subrecipients represented approximately 98 percent of the program's expenditures. As part of its pass-through responsibilities, 7 CFR Section 226.6(a)(5), the BCFNA is required to ensure subrecipients effectively operate the program. Regulation 2 CFR Section 200.332(b) requires pass-through entities to evaluate each subrecipient's risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. Regulation 2 CFR Section 200.332(d) requires pass-through entities to monitor the activities of the subrecipient as necessary to ensure the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. The BCFNA's subrecipient monitoring process, outlined in the Internal Nutritionist Manual, provides the requirements for monitoring the CACFP facilities/sponsors. The manual provides the planned frequency and type of monitoring activities, monitoring methods, and corrective action requirements. The manual requires the preparation of a risk assessment at the end of each monitoring review that assigns a grade of A, B, B-, or C to the facility/sponsor based on the number and severity of deficiencies and findings. Facilities/sponsors that receive a C grade are determined to be "seriously deficient." The assigned grade determines the required timing of future monitoring reviews of the facility/sponsor. Facilities/sponsors with an A grade will be next monitored in 3 years, a B grade within 2 years, a B- grade within 6 months to 1 year, and a C grade within 90 days. During each monitoring review, BCFNA personnel review documentation supporting a sample of claims during a test month. Any identified errors and associated overclaims/underclaims exceeding established thresholds are recouped/reimbursed in the facility's/sponsor's future claims. When reviews identify noncompliance, facilities/sponsors are required to prepare and submit a Corrective Action Plan (CAP) to the BCFNA. In addition, as noted at finding number 2024-008, the BCFNA relies on these subrecipient monitoring procedures to prevent and detect meal reimbursement claim errors. Monitoring reviews have identified significant issues and claim errors, including some potentially fraudulent activity, and led to over 15 contract terminations in recent years. To test compliance with subrecipient monitoring requirements, and to evaluate the effectiveness of BCFNA monitoring procedures, we reviewed and analyzed a randomly-selected sample of 60 BCFNA monitoring reviews conducted for 60 CACFP facilities/sponsors during the year ended June 30, 2024. While our review found the sample monitoring reviews were performed in accordance with the policies and procedures outlined in the Internal Nutritionist Manual, we identified areas in which these policies and procedures could be strengthened and improved to ensure facilities/sponsors comply with program requirements and submit proper claims. Our review and analysis of the 60 sampled monitoring reviews noted the monitoring reviews identified significant errors, noncompliance, disallowances, and overclaims. Our comparison of the sampled reviews to prior reviews noted deficient facilities/sponsors generally had continued deficiencies and little improvement from prior reviews, as follows: • Of the 60 sampled, 32 facilities/sponsors received an A grade, while 28 received grades of B, B-, or C. • Of the 24 facilities/sponsors that received grades of B, B-, or C, and had a prior review, 21 (88 percent) received the same or lower grade than the prior review. • Of the 4 facilities/sponsors that received a C grade and had a prior review, 2 (50 percent) received the same grade as the prior review, and 2 (50 percent) received a lower grade. • Of the 7 facilities/sponsors that received a C grade, 4 were terminated as a result of the review or as a result of a subsequent 90-day follow-up review. • For 43 of 59 (73 percent) monitoring reviews for which the BCFNA tested claims (with claims totaling $537,466 during the test months), the BCFNA identified overclaims totaling $48,508 and underclaims totaling $10,144, netting to $38,364, or at least 7 percent of the reimbursements tested. A. Risk Assessments The BCFNA prepares and uses risk assessments to determine the extent of monitoring necessary for each facility/sponsor. However, the risk assessments prepared during the year ended June 30, 2024, considered only the previous monitoring review grade (conducted up to 3 years previously), and did not consider other pertinent risk factors outlined in federal regulations. Regulation 2 CFR Section 200.332(b) suggests risk assessments should consider the subrecipient's prior experience with the same or similar subawards, the results of previous audits, whether the subrecipient has new personnel or new or substantially-changed systems, and the extent and results of federal awarding agency monitoring. While federal regulations provide the BCFNA discretion in selecting risk factors to consider, limiting risk assessments to only one risk factor and ignoring other relevant factors hinders the BCFNA's ability to identify red flags and fraud risk factors and properly assess facility/sponsor risk of noncompliance. Sufficient risk assessments are necessary to ensure monitoring reviews are conducted with adequate frequency to help ensure subrecipient compliance with program requirements. Finding classification This finding is classified as a significant deficiency in internal control and nonmaterial noncompliance with the federal subrecipient monitoring requirements regarding risk assessments. As noted in the finding, BCFNA risk assessments prepared during the year ended June 30, 2024, do not meet the spirit of the federal regulation, which suggests the extent and level of monitoring for each subrecipient be based on various risk factors. As a result, there is a risk that monitoring reviews will not be performed as frequently and thoroughly as needed to identify and address subrecipient noncompliance. Because the BCFNA does perform risk assessments for each subrecipient and does monitor the subrecipients with lower grades with more frequency, the finding did not rise to a level of material noncompliance, and was therefore considered nonmaterial noncompliance. Our decisions regarding the classification of the internal control deficiencies were made in accordance with AU-C Section 935, Compliance Audits and the AICPA Audit Guide: Government Auditing Standards and Single Audits (Audit Guide). In addition to the definitions outlined in part B of this finding, the Audit Guide states "[a] significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance." Our evaluation of the deficiencies for the possibility and magnitude of potential noncompliance determined the deficiencies are considered a significant deficiency. B. Subrecipient Monitoring Procedures Our review of BCFNA subrecipient monitoring procedures during the year ended June 30, 2024, noted areas that should be strengthened and improved. Corrective action plans BCFNA CAP review procedures were not adequate to ensure facilities/sponsors made and/or planned sufficient corrective actions to address noncompliance, as required by federal regulations. The Internal Nutritionist Manual requires nutritionists to review subrecipient CAPs outlining corrective actions taken or planned for completeness and to ensure the required action items are adequately addressed. However, during the year ended June 30, 2024, this review was generally performed without verifying the accuracy of the CAP information through review of supporting documentation, testing, or other methods. The BCFNA did not require submission of supporting documentation of corrective actions taken or planned. BCFNA officials indicated they may request supporting documentation on occasion depending on the complexity of the finding, and they verify the CAP during 90-day follow-up reviews of "seriously deficient" facilities/sponsors. Of the 60 monitoring reviews in our sample, 49 required a CAP. The monitoring review documentation indicated the CAP was verified during 7 of the 90-day follow-up reviews, but there was no documentation that the nutritionist verified the CAP information for any of the remaining 42 reviews (86 percent of the 49 reviews that required a CAP). Furthermore, our review of monitoring review documentation noted numerous instances in which the prior year CAP indicated a specific deficiency was addressed, but the same deficiency was again noted in the subsequent review. Regulation 2 CFR Section 200.332(d) provides that monitoring must include following up and ensuring the subrecipient takes timely and appropriate action on all deficiencies identified. The USDA CACFP handbook, Monitoring Handbook for State Agencies (USDA Monitoring Handbook), provides that follow-up reviews (on-site or desk reviews of paperwork) may be conducted any time corrective action is required to ensure the facility/sponsor has completely corrected the review findings, according to its approved corrective action response. Example CAP forms included in the USDA Handbook require facilities/sponsors to submit supporting documentation along with the CAP to verify corrections were made or will be implemented. The USDA CACFP handbook, Serious Deficiency, Suspension, & Appeals for State Agencies & Sponsoring Organizations, provides that facilities/sponsors deemed "seriously deficient," must submit additional supporting documentation with the CAP to document that corrective actions have occurred; this might include copies of income eligibility forms, enrollment rosters, staff training documentation, site monitoring reports, menus, child nutrition labels or manufacturers' product analysis sheets or recipes, attendance records, meal count forms, and itemized food receipts. Without verifying information in CAPs submitted, the BCFNA cannot demonstrate compliance with federal regulations and it lacks assurance the facilities/sponsors took timely and appropriate action on all deficiencies identified during monitoring reviews. In addition, there is increased risk that deficiencies will not be corrected and will continue without detection. In August 2024, the BCFNA implemented an electronic system for facilities/sponsors to upload documentation supporting their CAPs. In May 2025, the BCFNA updated the Internal Nutritionist Manual to provide for reviews of the supporting documentation to verify facilities/sponsors implemented corrective action. Claims testing The Internal Nutritionist Manual and monitoring practices provide for testing of a sample of claims within only 1 test month during each monitoring review, and do not provide for expanded testing when significant errors are identified. BCFNA personnel indicated monitoring reviews are limited to only 1 test month because the USDA Monitoring Handbook does not require expanded testing of records beyond 1 month. While the BCFNA performs additional testing during 90-day follow-up reviews for facilities/sponsors deemed "seriously deficient," additional testing is not performed in any other situation. For example, one facility had a 33 percent overpayment rate and received a B grade while another facility had a 100 percent overpayment rate and received a B- grade; however, additional testing was not performed for either facility. The USDA Monitoring Handbook suggests testing activities during 1 test month, and also suggests the state agency may determine additional review is warranted and review records beyond the test month to determine the extent of the noncompliance. When significant errors are identified, additional testing would help BCFNA nutritionists determine the extent that instances of noncompliance are isolated versus pervasive. Such information would be valuable to the overall conclusions and grade assigned to the review, and in decisions regarding subsequent monitoring. Overclaim recoupment BCFNA subrecipient monitoring procedures do not provide for identification and pursuit of recoupment of all overpayments associated with errors identified during monitoring reviews. When overclaims due to noncompliance with eligibility requirements are identified during monitoring reviews, the BCFNA only identifies and seeks recoupment for the overclaims made during the test month. Overclaims associated with eligibility errors begin at the time the eligibility determination was made and continue until the error is discovered. Although the BCFNA is aware noncompliance occurred during the month(s) before the test month, the BCFNA does not attempt to identify those overclaims. In addition, when a facility/sponsor is terminated, the BCFNA does not always identify or seek recoupment of overclaim amounts. In our sample of 60 monitoring reviews, the contract for 1 sponsor was terminated as a result of a 90-day follow-up review. For this sponsor, in the review prior to the 90-day follow-up review, the BCFNA identified and recouped overclaims totaling $2,278, or 100 percent of total claims tested. In the subsequent 90-day follow-up review significant claim errors were identified in the test month claims, which totaled $1,961; however, the test month claims were not fully tested, and overclaims were not identified or recouped. Any overclaims not identified and recouped from this terminated sponsor would be considered questioned costs; however, those questioned costs are unknown. BCFNA officials indicated they do not pursue recoupment of overclaims beyond the test month because this practice is allowed by the USDA. They indicated they pursue recoupment of overclaims for facilities/sponsors with terminated contracts on a case-by-case basis, considering various factors. However, 7 CFR Section 226.14 provides that state agencies shall disallow and recover any portion of a claim for reimbursement not properly payable, including claims not made in accordance with recordkeeping requirements. Pursuing full recoupment would hold facilities/sponsors accountable for all overclaims and would serve as a deterrent to future errors, noncompliance, and overclaims. Furthermore, without procedures to identify and recoup all overclaims, there is a risk that significant overclaims will go undetected and unrecouped, and questioned costs could be significant. Conclusions In addition to complying with federal requirements, strong subrecipient monitoring procedures are necessary to ensure facilities/sponsors comply with program requirements, submit proper claims, and address deficiencies identified. Without strong internal controls, there is increased risk of noncompliance, errors, fraud, waste, and abuse of federal funds. Strong monitoring procedures would ensure facilities/sponsors are held accountable for, and correct, errors and noncompliance identified. Regulation 2 CFR Section 200.332(g) requires pass-through entities to consider whether the results of the subrecipient's audits, on-site reviews, or other monitoring indicate conditions that necessitate adjustments to the pass-through entity's own records. Furthermore, 2 CFR Section 200.303(a) requires the non-federal entity to "[e]stablish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-federal entity is managing that 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." Finding classification This finding is classified as a material weakness in internal control and material noncompliance with the federal subrecipient monitoring requirements. Our audit of the BCFNA's compliance with federal subrecipient monitoring requirements concluded the BCFNA did not materially comply with federal requirements to ensure subrecipients effectively operate the CACFP and to monitor the activities of the subrecipient as necessary to ensure the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals. This conclusion is based on the facts, deficiencies, and noncompliance stated in the finding, including the following: (1) Disbursements to subrecipients represented approximately 98 percent of the CACFP expenditures. (2) BCFNA subrecipient monitoring reviews identified significant errors, noncompliance, disallowances, and overclaims; and deficiencies identified often continued for years with little improvement from review to review. The 7 percent subrecipient payment error rate identified by the BCFNA, which exceeds our audit materiality threshold of 4 percent, along with the high rate of continued noncompliance, serve as indicators of the ineffectiveness of the BCFNA monitoring process. (3) The BCFNA did not comply with specific components of federal subrecipient monitoring requirements, including properly following up and ensuring subrecipients take timely and appropriate action on all deficiencies identified and disallowing and recovering improper payments. (4) Multiple deficiencies in monitoring procedures were identified, including the previously-listed deficiencies and inadequate payment testing. In conducting a single audit in accordance with 2 CFR Part 200 (Uniform Guidance), auditors are required by 2 CFR Section 200.514(d)(1)(2), to determine whether the auditee has complied with federal statutes, regulations, and the terms and conditions of federal awards that may have a direct and material effect on each of its major programs, as outlined in the OMB Compliance Supplement. While compliance with the USDA CACFP handbooks was considered in the our audit, our conclusion on compliance is based on the BCFNA's compliance with the federal statutes and regulations, as required. Our decisions regarding the classification of the internal control deficiencies were made in accordance with AU-C Section 935, Compliance Audits and the Audit Guide. The Audit Guide provides the following definitions regarding internal control deficiencies: A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. "A reasonable possibility exists when the likelihood of the event is either reasonably possible or probable…" Reasonably possible is "[t]he chance of the future event or events occurring is more than remote but less than likely." Probable means "[t]he future event or events are likely to occur." The failure to design and implement adequate controls and procedures over subrecipient monitoring led to material noncompliance with the subrecipient monitoring requirements. The BCFNA's controls failed to develop an effective subrecipient monitoring process that ensures subrecipients use subawards for authorized purposes, comply with the terms and conditions of the subawards, and achieve performance goals. Because the internal control deficiencies have not been corrected, it is probable that the material noncompliance will continue. For these reasons, the deficiencies are considered a material weakness. Recommendations The DHSS through the BCFNA: A. Implement a CACFP subrecipient risk assessment process that is consistent with federal regulations. B. Review, strengthen, and enforce subrecipient monitoring procedures to ensure CACFP facilities/sponsors comply with program requirements, submit proper claims, and address deficiencies identified. The BCFNA should enhance procedures to provide for identification and recoupment of overclaims associated with all errors identified during monitoring reviews, as required by federal regulations; expand testing when significant errors are identified; and continue to verify CAP information. The DHSS should identify and recoup the overclaims for the terminated sponsor noted in this finding. Auditee's Response A. We disagree with the auditor's finding. Our Corrective Action Plan includes an explanation and specific reasons for our disagreement. B. We disagree with the auditor's finding. Our Corrective Action Plan includes an explanation and specific reasons for our disagreement. Auditor's Comment The DHSS Corrective Action Plan (CAP) states the DHSS disagrees with the finding because, while the prior year finding (finding number 2023-013) was partially sustained by the USDA - Food and Nutrition Service (USDA-FNS), a corrective action plan was accepted and deemed adequate by the USDA-FNS. The CAP also states in April 2025, the USDA-FNS recommended final action to close the prior year finding. These statements are not accurate. April and June 2025 emails from USDA-FNS officials to the DHSS regarding the prior audit finding, provided to auditors by DHSS officials, indicate the finding was sustained; corrective action was required, taken, and validated by the USFA-FNS; and final action was approved by the USDA-FNS on June 10, 2025. It is unclear why the DHSS considers the prior year finding to be only partially sustained when the Summary Schedule of Prior Audit Findings, which was also prepared by the DHSS, states the finding was sustained. Except for the information mentioned in the audit finding regarding subrecipient corrective action plans, the DHSS did not provide the State Auditor's Office information regarding corrective action taken. Any new procedures would have been implemented after the audit period, and will be subject to subsequent audits. Because the DHSS took no corrective action prior to or during the audit period, this finding is valid.
Assistance Listing Number, Federal Agency, and Program Name: Across all programs Federal Award Identification Number and Year: Across all programs Pass-through Entity – Various Finding Type – Material weakness in internal control over compliance Repeat Finding – N/A Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended March 31, 2024. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Activities related to a certain Federal grant were not accurately monitored or tracked to ensure proper reporting, which in turn caused a delay in closing the books and records in a timely manner. Effect – The data collection form was not submitted within the required time as required by 2 CFR 200.512. Recommendation – We recommend that the Organization maintain a system of policies, procedures, and controls to ensure that the financial records closed in a timely manner in order to facilitate the timely submission of the data collection form. View of Responsible Officials and Corrective Action Plan – To enhance the efficiency and accuracy of financial reporting in a timely manner, the Organization will implement a detailed checklist and timeline for grant closeout procedures. The finance team will ensure expenditures meet the grant agreement schedule and follow the grant closeout guidelines. The procedures will be supported by a calendar reminder system for all critical milestones. This finding relates one legacy grant.
Assistance Listing Number, Federal Agency, and Program Name: Across all programs Federal Award Identification Number and Year: Across all programs Pass-through Entity – Various Finding Type – Material weakness in internal control over compliance Repeat Finding – N/A Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended March 31, 2024. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Activities related to a certain Federal grant were not accurately monitored or tracked to ensure proper reporting, which in turn caused a delay in closing the books and records in a timely manner. Effect – The data collection form was not submitted within the required time as required by 2 CFR 200.512. Recommendation – We recommend that the Organization maintain a system of policies, procedures, and controls to ensure that the financial records closed in a timely manner in order to facilitate the timely submission of the data collection form. View of Responsible Officials and Corrective Action Plan – To enhance the efficiency and accuracy of financial reporting in a timely manner, the Organization will implement a detailed checklist and timeline for grant closeout procedures. The finance team will ensure expenditures meet the grant agreement schedule and follow the grant closeout guidelines. The procedures will be supported by a calendar reminder system for all critical milestones. This finding relates one legacy grant.
Assistance Listing Number, Federal Agency, and Program Name: Across all programs Federal Award Identification Number and Year: Across all programs Pass-through Entity – Various Finding Type – Material weakness in internal control over compliance Repeat Finding – N/A Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended March 31, 2024. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Activities related to a certain Federal grant were not accurately monitored or tracked to ensure proper reporting, which in turn caused a delay in closing the books and records in a timely manner. Effect – The data collection form was not submitted within the required time as required by 2 CFR 200.512. Recommendation – We recommend that the Organization maintain a system of policies, procedures, and controls to ensure that the financial records closed in a timely manner in order to facilitate the timely submission of the data collection form. View of Responsible Officials and Corrective Action Plan – To enhance the efficiency and accuracy of financial reporting in a timely manner, the Organization will implement a detailed checklist and timeline for grant closeout procedures. The finance team will ensure expenditures meet the grant agreement schedule and follow the grant closeout guidelines. The procedures will be supported by a calendar reminder system for all critical milestones. This finding relates one legacy grant.
Assistance Listing Number, Federal Agency, and Program Name: Across all programs Federal Award Identification Number and Year: Across all programs Pass-through Entity – Various Finding Type – Material weakness in internal control over compliance Repeat Finding – N/A Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended March 31, 2024. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Activities related to a certain Federal grant were not accurately monitored or tracked to ensure proper reporting, which in turn caused a delay in closing the books and records in a timely manner. Effect – The data collection form was not submitted within the required time as required by 2 CFR 200.512. Recommendation – We recommend that the Organization maintain a system of policies, procedures, and controls to ensure that the financial records closed in a timely manner in order to facilitate the timely submission of the data collection form. View of Responsible Officials and Corrective Action Plan – To enhance the efficiency and accuracy of financial reporting in a timely manner, the Organization will implement a detailed checklist and timeline for grant closeout procedures. The finance team will ensure expenditures meet the grant agreement schedule and follow the grant closeout guidelines. The procedures will be supported by a calendar reminder system for all critical milestones. This finding relates one legacy grant.
Assistance Listing Number, Federal Agency, and Program Name: Across all programs Federal Award Identification Number and Year: Across all programs Pass-through Entity – Various Finding Type – Material weakness in internal control over compliance Repeat Finding – N/A Criteria – Per 2 CFR 200.512 (a) (1), the audit must be completed, and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted 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. Per 2 CFR 200.501 (b), a non-Federal entity that expends $750,000 or more during the non-Federal entity's fiscal year in Federal awards must have a single audit conducted in accordance with § 200.514. Condition – The data collection form was not submitted within the required time as required by 2 CFR 200.512 for the year ended March 31, 2024. Identification of How Questioned Costs Were Computed – N/A Questioned Costs – None Cause – Activities related to a certain Federal grant were not accurately monitored or tracked to ensure proper reporting, which in turn caused a delay in closing the books and records in a timely manner. Effect – The data collection form was not submitted within the required time as required by 2 CFR 200.512. Recommendation – We recommend that the Organization maintain a system of policies, procedures, and controls to ensure that the financial records closed in a timely manner in order to facilitate the timely submission of the data collection form. View of Responsible Officials and Corrective Action Plan – To enhance the efficiency and accuracy of financial reporting in a timely manner, the Organization will implement a detailed checklist and timeline for grant closeout procedures. The finance team will ensure expenditures meet the grant agreement schedule and follow the grant closeout guidelines. The procedures will be supported by a calendar reminder system for all critical milestones. This finding relates one legacy grant.
Criteria: A non-Federal entity that expends $750,000 or more in Federal awards during the year must have a single audit conducted in accordance with 2 CFR §200.514. Pursuant to 2 CFR §200.512, the audit must be completed and Form SF-SAC: Data Collection Form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditors’ report(s), or nine months after year end of the audit period. Condition: We noted that the Organization has not submitted the single audit reports required by the Uniform Guidance, including the Data Collection Form to the Federal Audit Clearinghouse for the year ended March 31, 2024, within the stipulated nine months after the end of the audit period. Cause: The Organization has not adhered to established Uniform Guidance terms and conditions regarding the submission dates of the single audit reports and Data Collection Form for the year ended March 31, 2024. Effect:The Organization is not in compliance with the Uniform Guidance terms and conditions regarding the submission dates of the single audit reports and Data Collection Form for the year ended March 31, 2024. Recommendation:We recommend that the Organization incorporate internal controls to ensure compliance with the Uniform Guidance with respect to the deadline for submission of the single audit reports to the Federal Audit Clearinghouse. Views of Responsible Officials and Planned Corrective Action: The Organization agrees with the finding and the recommendation.Management will work diligently with its audit firm to ensure that future single audit reports are filed timely with the Federal Audit Clearinghouse.