Finding Text
Finding 2024-002 Preparation of the Schedule Expenditures of Federal Awards -Significant
Deficiency in Internal Control over Compliance
Program: U.S. Department of Treasury
Coronavirus State and Local Fiscal Recovery Funds
ALN 21.027
Award year: 2022, 2023
Criteria: The Uniform Guidance (2 CFR 200) Section 200.510 requires an auditee to
“prepare a schedule of expenditures of Federal awards (SEFA) for the period
covered by the auditee’s financial statements [that]….at a minimum shall…list
individual Federal programs by Federal agency…[and] provide total Federal
awards expended for each individual Federal program and the Assistance
Listing Number (ALN) number or other identifying number when the ALN
information is not available.” In accordance with Uniform Guidance, the
Organization is required to maintain a structure of internal control to ensure
compliance with applicable reporting requirements.
Condition/Cause: The Health Center did not have sufficient controls to ensure the SEFA
included all expenditures that qualified as an expenditure of a federal award
during the period.
Effect: The total expenditures presented per the preliminary SEFA increased by
$4,800,000 related to ALN #21.027, Coronavirus State and Local Fiscal
Recovery Funds, which resulted in an additional major program. No changes
to the other financial statements were needed and the final SEFA was
corrected to reflect the change.
Questioned Costs: Not applicable.
Context: Factors contributing to the condition included the high volume of activity
related to new COVID-19 programs and the lack of understanding that the
related payments represented grant expenditures from a Federal source that
were required to be reported on the SEFA as opposed to grant payments
from a non-federal source.
Repeat Finding: Not applicable.
Recommendation: We recommend the Health Center develop and implement a review process
through the year to ensure compliance with SEFA reporting requirements as
outlined in the Uniform Guidance.
Views of Responsible
Officials:
Processes will be put in place to compile the SEFA, provide adequete training
to staff, and perform a related review prior to audit. In addition, grant
agreements will be thoroughly reviewed.