Finding 1076291 (2023-002)

Subject: 2023-002 Coronavirus State and Local Fiscal Recovery Funds – Reporting Federal Agency: Department of the Treasury Federal Program: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Compliance Requirement: Reporting Audit Finding: Significant Deficiency and Noncompliance Criteria: 2 CFR 200.303 includes requirements related to internal controls for federal award programs, including that the Agency must, among other things, “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 and Context: We noted the City submitted a report required under the Coronavirus State and Local Fiscal Recovery Funds which did not have adequate review of the report for accuracy of the information or inclusion of the appropriate key line items. This finding is a repeat finding of 2021-003 and 2022-002. Cause and Effect: We noted lack of internal controls surrounding the reporting process resulted in key line items to be misstated and the errors were identified subsequent to the initial submission. There were no questioned costs related to this issue. Recommendation: We recommend the City implement procedures to ensure reports are being reviewed by an individual or third-party familiar with the program prior to submission. Views of Responsible Officials and Planned Corrective Actions: The City agrees with the recommendation and plans to implement the recommendation during 2024.