Finding 1103489 (2024-003)

Audit Finding 2024-003 – Timely Funds Disbursements Criteria: Code of Federal Regulations § 200.305 (b) requires that for recipients and subrecipients other than States, payment methods must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and the disbursement of funds by the recipient or subrecipient regardless of whether the payment is made by electronic funds transfer or by other means. Code of Federal Regulations § 200.305 (b)(1) requires that advance payments to a recipient or subrecipient must be limited to the minimum amounts needed and be timed with actual, immediate cash requirements of the recipient or subrecipient in carrying out the purpose of the approved program or project. The timing and amount of advance payments must be as close as is administratively feasible to the actual disbursements by the recipient or subrecipient for direct program or project costs and the proportionate share of any allowable indirect costs. Condition: During the audit, we noted the Authority did not disburse their funds within a timely manner. Cause: The Authority did not disburse the CFP funds held in unearned revenue before drawing new funds. Effect: The Authority is not in compliance with Code of Federal Regulations § 200.305 (b) and Code of Federal Regulations § 200.305 (b)(1). Recommendation: We recommend that the Authority disburse their funds in a timely manner. View of Responsible Officials: Management agrees with the finding.