Finding Text
Assistance Listing, Federal Agency, and Program Name - 21.027, U.S. Department of the Treasury, COVID-19 - Coronavirus State and Local Fiscal Recovery Funds
Federal Award Identification Number and Year - SLFRP0127
Pass through Entity - State of Michigan
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - Yes
2023-004
Criteria - In accordance with the City's subrecipient agreement with the State of Michigan, the City is required to submit periodic project and expenditure reports. The state requires the City to submit quarterly reports as well as an annual progress report.
Condition - The City submitted the required reports, but the amount reported as current expenditures in two of the quarterly reports submitted and as cumulative expenditures in the annual progress report were incorrect.
Questioned Costs - None
Identification of How Questioned Costs Were Computed - N/A
Context - The City reported current period expenditures in the March 2024 quarterly report of $360,400, when the actual current period expenditures related to the project were $106,500. The City reported current period expenditures in the September 2024 quarterly report of $1,198,498, when the actual current period expenditures related to the project were $1,954,510. The City reported cumulative expenditures in the September 2024 annual progress report of $1,363,322, when the actual cumulative expenditures related to the project were $2,458,818.
Cause and Effect - The City did not have controls in place to review the reports prior to submission. As a result, the reports were submitted with incorrect expenditure amounts.
Recommendation - We recommend the City implement a process to ensure reports are reviewed for accuracy prior to submission.
Views of Responsible Officials and Planned Corrective Actions - The City will review future reports to ensure the appropriate expenditures are disclosed.