Finding Text
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)”.
2 CFR 200.329(c)(1) includes requirements related to performance reports for federal award programs, including that the IEDC must submit performance reports as required by the Federal award. Non-construction awards under Assistance Listing number 11.307 require recipients of awards on or after June 1, 2020, to submit ED-916 and ED-918.
Condition and Context: We noted IEDC submitted the SF-425 Federal Financial Report required under the Economic Adjustment Assistance grant which reported an inaccurate amount of cash receipts during the reporting period identified. The difference noted was not material to the major program.
We also reviewed whether performance reports ED-916 and ED-918 required under the Economic Adjustment Assistance were submitted in a timely manner noting the reports were not filed as of the required submission date. There were no questioned costs related to this finding.
Cause and Effect: We noted lack of internal controls surrounding the reporting process resulted in key line items in the SF-425 Federal Financial Report to be misstated. The errors were identified subsequent to the submission and corrected in the submission of the final SF-425 Federal Financial Report.
We also noted lack of internal controls surrounding the reporting process resulted in performance reports for this federal award to be submitted after the required submission date.
Recommendation: We recommend IEDC implement procedures to ensure reports are being reviewed by an individual familiar with the program prior to submission and are being submitted timely and accurately during the reporting period.
Views of Responsible Officials and Actions Taken: We agree with the recommendation and as of October 2024 have implemented an additional layer of review, effective for the first round of reports filed for FY2025.