Finding Text
Finding 2024-02: Noncompliance with Timely Financial Reporting for Federal Grant Award and State Reporting requirements Criteria: 2 CFR § 200.327(a) states that grantees must submit financial reports no less frequently than annually. Further, SEFA to the Federal Audit Clearinghouse website within nine (9) months of June 30, 2024. UMARC also didn’t submit its audited financial statements, CYEFR, and other required information to the GATA portal within six (6) months after June 30, 2024. Condition: The report for the quarter ended June 30, 2024, was due on July 30, 2024, was not submitted as of the date of this Audit, and the annual financial reports for FY24, were due on December 31, 2024, were also not submitted to the GATA portal as of the date of this audit. Cause: The grantee's internal controls over financial reporting were inadequate, lacking tracking, formal review, and approvals. As well as the late appointment of a new auditor. Effect: Late submission of financial reports hinders the federal agency's ability to monitor the financial health and programmatic progress of the grant. This can delay funding disbursements, impede program evaluation, and potentially lead to closer scrutiny of the grantee's activities. It also prevents the agency from fulfilling its oversight responsibilities as outlined in 2 CFR Part 200. Recommendation: Develop and implement a comprehensive financial reporting calendar that clearly identifies deadlines for all required reports and assigns responsibility for their preparation and submission. This calendar should be distributed to all relevant staff. Also provide comprehensive training to the finance staff on federal financial reporting requirements, including 2 CFR Part 200 and the specific requirements of this grant agreement. Include training on the grantee's internal financial reporting policies and procedures. Questioned Costs None noted Auditee Response: Management concurs with the finding. A new financial reporting calendar has been implemented and distributed to all staff. A formal review and approval process for financial reports has been implemented. The report for the quarter ended June 2024 will be submitted by end of March 2025.