Finding 1089894 (2023-003)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
-
Year
2023
Accepted
2024-12-06

AI Summary

  • Core Issue: Financial transactions were not allocated correctly to federally funded programs, risking improper fund management.
  • Impacted Requirements: This violates 2 CFR 200.302, which mandates accurate records for federal funds, including their source and application.
  • Recommended Follow-Up: Implement internal controls to ensure accurate transaction allocation and improve financial reporting for federally funded projects.

Finding Text

2023-003Financial Management System- (Material Weakness) Criteria:According to 2 CFR 200.302, the financial management system of each non-Federal entity must provide records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Condition: Statement of financial position transactions were not allocated properly to programs/properties funded with federal funds. Cause: Due to a human error of individuals who were handling the accounting entries, some of transactions were not accurately allocated to the correct programs/properties. Effect: Improper allocation of transactions among various programs/properties could lead to comingling of funds from different projects. This could result in unallowable cost or in allowable cost charged simultaneously to two different programs/properties. Questioned Cost: Undetermined Recommendation: Establish an internal control procedures in place that provide for separate accountability for projects by allocating transactions properly and producing accurate financial reports for each federally funded programs/properties. Management's Views and Corrective Action Plan Management's response is included in "Management's View and Corrective Action Plan" at the end of this report after the schedule of findings and questioned cost

Categories

Allowable Costs / Cost Principles

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.239 Home Investment Partnerships Program $2.26M
14.871 Section 8 Housing Choice Vouchers $338,939
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $292,196
10.427 Rural Rental Assistance Payments $90,121
10.769 Rural Business Enterprise Grants $45,000
10.415 Rural Rental Housing Loans $42,316