Finding 1075110 (2023-002)

Federal Program Coronavirus State and Local Fiscal Recovery Funds (AL 21.027) Activities Allowed or Unallowed, Allowable Costs, Reporting Criteria Federal reporting requirements require expenditures to be based on actual expenditures incurred. In addition, internal controls should be implemented over reporting to prevent errors on reports. Condition The County charged expenditures to the program based on budgeted expenditures, not actual expenditures. Questioned Costs $23,567 Context The program consisted of 121 transactions, of which 13 haphazard transactions were tested. There was only one (1) transaction of its type with this issue. This transaction is roughly 45% of the overall program expenditures. Cause The County created a budget spreadsheet of what they would charge to the program. The budgeted amount calculated was charged to the program. It was determined that these budgeted items did not agree to actual expenditures incurred. Effect Expenditures charged to the program were overstated. These budgeted expenditures were included in the financial reports submitted causing the financial report to be incorrect. Repeat Finding The County received a finding related to reporting in the prior year. Recommendation The County should implement procedures to ensure that expenditures charged to federal programs are based on actual expenditures. The County should also ensure that all reports submitted should be reviewed by someone other than the preparer and this review should be documented. Views of Responsible Officials and Planned Corrective Actions The County agrees with the recommendation and will review its procedures.