Finding Text
Type of Finding: Significant Deficiency in Internal Control over Compliance – Reporting
Federal Agency: U.S. Department of Health and Human Services
Federal Program Name: Aging Cluster
Assistance Listing Number: 93.044 / 93.045 / 93.053
Federal Award Identification Number and Year: DA23-1109-2023
Pass-Through Agency: City of Seattle
Pass-Through Number(s): DA23-1109
Award Period: January 1, 2023 through December 31, 2023
Criteria or specific requirement: 2 CFR 200.303(a) states that 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 be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)."
Condition: During testing of reporting, it was noted that, for one sample, documentation was not retained of approval of financial reporting.
Questioned costs: None
Context: A sample of 9 financial reports was made from a population of 54 total reports. Of the 9 sampled, 1 was missing evidence of authorized personnel review and approval.
Cause: In this one instance, verbal approval was given rather than via emailed approval.
Effect: Without adequate documentation and controls in place to ensure costs are reasonable and intended for the program charged, Sound Generations could incorrectly charge expenditures to the federal program, report fraudulent expenditures, or not request appropriate reimbursement that Sound Generations is entitled to under the terms of the grant.
Repeat Finding: No.
Recommendation: CLA recommends that documentation is retained as proof of authorized personnel review.
Views of responsible officials: Please see the attached Management’s Corrective Action Plan.