Finding Text
FINDING 2023-002
Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Reporting
Federal Agency: Department of the Treasury
Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds
Assistance Listings Number: 21.027
Federal Award Number and Year (or Other Identifying Number): FY2022
Compliance Requirement: Reporting
Audit Findings: Material Weakness, Modified Opinion
Repeat Finding
This is a repeat finding from the immediately prior audit report. The prior audit finding number was
2022-006.
Condition and Context
Recipients are required to quarterly or annually submit Project and Expenditure (P&E) reports to
the U.S. Department of the Treasury (Treasury). The reporting periods as well as the respective due dates
are based upon type of recipient and its population as well as the recipient's allocation amount. Information
to be reported includes projects funded, expenditures, and contracts for the appropriate reporting period.
INDIANA STATE BOARD OF ACCOUNTS
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PUTNAM COUNTY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
The County was classified as a county with a population less than 250,000 residents that received
an allocation of less than $10 million in COVID-19 - Coronavirus State and Local Fiscal Recovery Funds
award funds. As such, the County was required to submit an annual P&E report covering the period April
1, 2022 to March 31, 2023, during the audit period.
The P&E report due by April 30, 2023, was submitted timely but the report was not accurate and
complete. The report did not include any project descriptions, expenditure amounts, or obligation amounts
despite the County having made several awards to different entities in support of various activities within
the County. Total current period expenditures for the reporting period per the County's ledger were
$5,502,689. In addition, there were nine projects, contracts, or awards exceeding $50,000 awarded during
the reporting period that were not disclosed in the report.
The lack of internal controls and noncompliance were systemic issues throughout the audit period.
Criteria
2 CFR 200.303 states in part:
"The non-Federal entity must:
(a) Establish and maintain effective internal control over the Federal award that provides
reasonable assurance that the non-Federal entity is managing the Federal award in
compliance with Federal statutes, regulations, and the terms and conditions of the Federal
award. These internal controls should be in compliance with guidance in 'Standards for
Internal Control in the Federal Government' issued by the Comptroller General of the
United States or the 'Internal Control Integrated Framework', issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). . . ."
Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guidance, page
10, states in part:
". . . 10. Reporting. All recipients of federal funds must complete financial, performance, and
compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be
reported on a cash or accrual basis, as long as the methodology is disclosed and consistently
applied. Reporting must be consistent with the definition of expenditures pursuant to
2 CFR 200.1. Your organization should appropriately maintain accounting records for
compiling and reporting accurate, compliant financial data, in accordance with appropriate
accounting standards and principles. . . ."
31 CFR 35.4(c) states in part: "Reporting and requests for other information. During the period of
performance, recipients shall provide to the Secretary periodic reports providing detailed accounting of the
uses of funds, . . ."
Cause
The P&E report was not properly researched and reviewed by the County staff prior to submission.
INDIANA STATE BOARD OF ACCOUNTS
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PUTNAM COUNTY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
Effect
Without the proper implementation of an effectively designed system of internal controls, including
policies and procedures that provide segregation of duties and additional oversight as needed, the internal
control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance.
As such, the County did not properly report project descriptions and amounts expended when
filing the P&E report during the audit period.
Questioned Costs
There were no questioned costs identified.
Recommendation
We recommended that management of the County strengthen its system of internal controls to
ensure appropriate reviews, approvals, and oversight are taking place of the work completed by the
consultant. We also recommended the development of policies and procedures to ensure the County
provides the County Treasury with complete and accurate information for the P&E reports.
Views of Responsible Officials
For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
INDIANA STATE BOARD OF ACCOUNTS
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