Finding Text
Assistance Listing Number, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds
Federal Award Identification Number and Year - N/A
Pass-through Entity - Genesee County, Michigan
Finding Type - Material weakness
Repeat Finding - No
Criteria - Per 2 CFR 200.508(b), an auditee must properly prepare the schedule of expenditures of federal awards (SEFA). Per 2 CFR 200.510(b), the SEFA for the period covered by the auditee's financial statements
must include the total federal awards expended as determined in accordance with 2 CFR 200.502, which describes the basis for determining federal awards expenses.
Condition - The SEFA for the year ended June 30, 2023 was not accurately prepared, as it originally included expenditures that were improperly excluded from the SEFA for the year ended June 30, 2022.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - Required revisions were identified during the audit to ensure that the schedule of expenditures of federal awards was accurately stated. These revisions related to $136,295 of federal awards expended during the year ended June 30, 2022 that were not reported on the SEFA until the year ended June 30, 2023. These expenditures related to ALN 21.027 (Coronavirus State and Local Fiscal Recovery Funds). This amount did not impact the program type or major program determination for the year ended June 30, 2022.
Cause and Effect - Internal control procedures relative to the identification of federal expenditures to be reported on the SEFA did not operate effectively. This resulted in the City's schedule of expenditures of federal awards for the prior year being understated and the amounts included in the current year expenditures of federal awards prior to audit-identified revisions. The amounts did not impact the program type or major program determination for the year ended June 30, 2022.
Recommendation - The City should expand procedures and review processes to ensure the proper expenditures are reported on the schedule of expenditures of federal awards.
Views of Responsible Officials and Corrective Action Plan - The City will implement additional supervisory review of expenditures included on the SEFA.