Finding Text
Federal Awards Findings and Questioned Costs
Finding 2023-003 – Inaccurate SEFA - Reporting – Material Weakness
Name of Federal Agency: U.S Department of Housing and Urban Development and U.S.
Department of Treasury
Federal Program Name: HOME Investments Partnership Program and Coronavirus State and
Local Fiscal Recovery Funds
Assistance Listing Number: 14.239 and 21.027
Federal Award Identification Number and Year: Identification number unavailable. Program
years 2010, 2012, 2015, 2019, 2023.
Name of Pass-through Entity (if applicable): Rhode Island Housing and Mortgage Finance
Corporation and the City of Providence, Rhode Island.
Criteria: In accordance with 2 CFR 200.302 (Financial Management), a grant recipient’s financial
management system must be sufficient to permit the preparation of reports required by general
and program-specific terms and conditions; the tracing of funds to a level of expenditures
adequate to establish that such funds have been used according to the federal statutes,
regulations, and the terms and conditions of the federal award.
In addition, 2 CFR 200.510 (Financial Statements), states in part that the auditee must prepare a
schedule of expenditures of Federal awards (“SEFA”) for the period covered by the auditee's
financial statements which must include the total Federal awards expended as determined in
accordance with 2CFR 200.502. At a minimum, the schedule must include:
-All individual Federal programs by Federal agency.
-For Federal awards received as a subrecipient, the name of the pass-through entity and
identifying number assigned by the pass-through entity must be included.
-Provide total Federal awards expended for each individual Federal program and the
Assistance Listings Number or other identifying number when the Assistance Listings
information is not available.
-Include the total amount provided to subrecipients from each Federal program.
Condition / Context: The Organization management’s review and approval process did not detect
the errors that were identified during the audit procedures performed. The errors detected
consisted of the understatement of Federal Assistance Listing Numbers 14.239 and 14.218 in the
amounts of $364,207 and $295,000, respectively, and an overstatement of Federal Assistance
Listing Number 21.027 in the amount of $66,320, for a total net understatement of $592,887.
Cause: The Organization’s internal controls over the preparation and review of the SEFA were
not operating effectively. Material audit adjustments were proposed during the course of the audit
that lead to material changes to the SEFA.
Effect or Potential Effect: Inadequate controls over the preparation of the SEFA could result in
financial misstatements or potential noncompliance.
Questioned Costs: None
Identification as a Repeat Finding: This is a repeat finding for Assistance Listing Number 14.239. See 2022-003.
Recommendation: We recommend the Organization strengthen its policies, procedures, and
controls for the identification of federal awards to ensure a complete and accurate SEFA is
prepared in a timely manner.
Views of Responsible Officials: Management agrees with the finding and is in the process of
revising internal controls to address SEFA preparation.