Finding 1079617 (2023-003)

2023-003: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Cash Management Significant Deficiency in Internal Control over Compliance and Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB Compliance Supplement requires that reimbursement-based grant recipient submit timely a request for reimbursement (RFR) to the granting agency and that all expenditures included in the RFR were incurred prior to the date of the submitted request. Wallowa Resources may submit monthly RFRs to exFedGrants system or directly to the Farm Production and Conservation (FPAC) Grants and Agreements Division. There is no specified frequency for RFR submission. Condition: RFRs are prepared and submitted by the same employee. Cause: Wallowa Resources did not have adequate internal controls to ensure the RFRs were prepared in accordance with governing requirements. Effect: Though no current year misstatement or material noncompliance was identified, the finding is systematic and therefor is risen to a significant deficiency, as it could become material if not correct. Questioned Costs: None Context/Sampling: There were two RFRs submitted within the scope of this audit. No misstatements or material noncompliance identified. Lack of segregation of duties present in both submissions. Repeat Finding from Prior Year: No Recommendation: The circumstance is not unusual in an organization of Wallowa Resource’s size. It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with condition because of cost or other consideration. Views of Responsible Officials: Management agrees with the finding.