Finding 1136552 (2024-008)

Condition: During our audit of the Abandoned Mine Land and Reclamation Program, we noted that the submission of the quarterly SF-425 Federal Financial Reports was not completed within 30 days after the reporting period end date. Context: The SF-425 Federal Financial Reports for the four quarters of fiscal year 2024 were not submitted by their respective deadlines of 30 days after the reporting period end date. All fiscal year 2024 reports were filed in April 2025. Criteria: 2 C.F.R. § 1000.10 gives regulatory effect to the Department of Treasury for 2 C.F.R. § 200.328, which establishes requirements over federal reporting, and states: Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB-approved governmentwide data elements for collection of financial information at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB approved common information collections, as applicable, when providing financial and performance reporting information. 2 C.F.R. § 1000.10 gives regulatory effect to the Department of Treasury for 2 C.F.R. § 200.329(b), which establishes requirements over federal reporting, and states: Reporting program performance. The Federal awarding agency must use OMB-approved common information collections, as applicable, when providing financial and performance reporting information. As appropriate and in accordance with above mentioned information collections, the Federal awarding agency must require the recipient to relate financial data and accomplishments to performance goals and objectives of the Federal award. Also, in accordance with above mentioned common information collections, and when required by the terms and conditions of the Federal award, recipients must provide cost information to demonstrate cost effective practices (e.g., through unit cost data). In some instances (e.g., discretionary research awards), this will be limited to the requirement to submit technical performance reports (to be evaluated in accordance with Federal awarding agency policy). Reporting requirements must be clearly articulated such that, where appropriate, performance during the execution of the Federal award has a standard against which non-Federal entity performance can be measured. It is management's responsibility to implement internal control procedures to reasonably ensure the federal reports they submit are accurate, complete, and in compliance with program requirements. It is imperative that management be able to provide the underlying data and related program documentation required to prepare and support these reports. The Town’s management is responsible for the preparation of the quarterly SF-425 Federal Financial Report, as required by 2 C.F.R. § 200.328. Questioned Costs: $0 Cause: The Town did not have adequate controls in place to ensure the quarterly SF-425 Federal Financial Reports, were submitted within 30 days after the reporting period end date. Effect: The SF-425 Federal Financial Reports were not submitted by their respective deadlines of 30 days after the reporting period end date. Recommendation: We recommend the Town review these regulations and comply with the provisions set forth therein. A policy should be established to ensure that each SF-425 Federal Financial Report is submitted by its due date of 30 days after the reporting period end date. Management should periodically review these procedures to ensure they are operating as intended. Response: Management stated they have established a policy to ensure each quarterly report is submitted by its due date.