Finding Text
2022-004 Internal Controls over Preparation of the Schedule of Expenditures of Federal Awards (Material Weakness – All Awards)
Criteria: Per 2 CFR 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards, £200.508 (b), the auditee must prepare appropriate statements including an accurate Schedule of Expenditures of Federal Awards (SEFA) in accordance with £200.510, Financial Statements.
Condition and Context: Audit procedures noted several errors in the client provided SEFA.
Cause: Insufficient training and internal controls over the preparation and review process for the SEFA.
Effect: The following errors were noted and corrected as a result of auditing procedures on the SEFA:
• The SEFA did not include the following programs:
o U.S. Department of Labor 17.225 Unemployment Insurance Navigator
o U.S. Treasury 21.027 Workforce Navigator
o U.S. Department of Health and Human Services 93.268 Immunization Services
• U.S. Treasury 21.023 Emergency Rental Assistance expenditures were understated by $402,678
• U.S. Treasury 21.027 Housing Navigator expenditures were understated by $3,265
Questioned Costs – None
Recommendation: Management should seek appropriate training for the fiscal department on preparation of the SEFA standards. In addition, review processes over the SEFA should be strengthened. Management should consider contracting with an experienced accounting consultant should they identify areas that require additional expertise and review after the drafting of the SEFA and prior to the submission for audit.
Views of Responsible Officials and Planned Corrective Actions: This is the first year the Organization required a Single Audit and the first time a SEFA was prepared. Accounting staff will prepare the SEFA according to mandated guidelines and will work with an experienced accounting consultant to provide additional training for staff on Uniform Guidance requirements and review the SEFA prior to filing.