Finding Text
Finding Reference 2024-006
Federal Agency: U.S. Department of Health and Human Services
Pass-Through Agency: Puerto Rico Department of Family
Program: Child Care and Development Block Grant (ALN 93.575)
Compliance Requirement: Earmarking (G)
Type of Finding: Significant Deficiency in Internal Controls (SD), Instance of Noncompliance (NC)
Statement of Condition In our Earmarking Test, we were not able to corroborate compliance with the earmarking requirements because the Municipality did not submit the program annual closing reports.
Criteria The contract agreement states in Clause four point eight (4.8) that the Municipality will be responsible for ensuring that all administrative, programmatic and fiscal requirements of the Proposal are met.
The contract agreement states in Clause thirteen (13) that the Municipality is responsible for the presentation of the trial balance and annual partial closing report fifteen (15) calendar days after the end of the contract. Ninety (90) days after, the Municipality should liquidate all obligations and present to the pass-through entity the final annual closing report (CC-006).
Cause of Condition The Program does not have effective internal controls to ensure that the required reports and supporting documentation are submitted to the pass-through agency in the requested time frame.
Effect of Condition We could not corroborate that Municipality expended the Program funds for administrative costs and service categories according to the budget limitations of the approved Proposal.
Recommendation Management should take the necessary steps to ensure that the Program submits its financial reports within the time frame required by the state pass-through agency.
Questioned Cost None.
Prior Year Finding No.
Views of Responsible Officials and Planned Corrective Action We concur with the finding. The Municipality appointed a person to work on all the required reports and instructed them on the deadlines that apply. We are in compliance with the earmarking requirements, once reports are submitted, evidence will be provided.
Implementation Date: June 30, 2025
Responsible Person: Carmen López
Interim Finance Director