Finding 1096531 (2024-002)

2024‐002 INTERNAL CONTROL DOCUMENTATION Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number U.S. Department of Housing and Urban Development Community Development Block Grants/Entitlement Grants 14.218 Criteria: 2 CFR 200.303 requires that a non‐federal entity must “(a) 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 and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: The City’s policies provide for review and approval of documentation and reports related to program compliance requirements however, evidence supporting the review for internal control purposes was not consistently documented or retained. Questioned Costs: Unknown Context: Total federal expenditures for the Community Development Block Grants/Entitlement Grants were $3,436,560 for the year ended June 30, 2024. Cause: The City did not retain adequate documentation supporting the review and approval of documentation. Effect: The City may not be in compliance with related program compliance requirements. Recommendation: We recommend that the City enhance their policies to ensure that documentation of review and approvals are maintained as evidence of controls with the specified requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.