Finding Text
Finding Number: 2022-003
Finding Type: Federal award finding and financial statement finding
Federal Assistance Listing No.: 14.239
Program Name: HOME investment Partnership Program
Federal Agency: U.S. Department of Housing and Urban Development
Pass-Through Entity: Portland Housing Bureau
Grant Numbers: 311020
Federal Award Year: 2022
Control Deficiency Type: Significant deficiency in internal controls over compliance
Instance of Noncompliance: Yes
Compliance Requirement: Reporting
Questioned Costs: None
Repeat Finding: No
Criteria: 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Awards Requirements, Standards for Financial and Program Management, and §200.302 (b), Financial Management. Identification, in its accounts, of all federal awards received and expended and the federal program under which they were received. Federal program and federal award identification must include, as applicable, the CFDA title and number, federal award identification number, name of the federal agency, and name of the pass-through entity, if any.
Additional criteria: 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart F – Audit Requirements, §200.510, Financial Statements. Schedule of Expenditures of Federal Awards – The auditee also must prepare a schedule of expenditures of federal awards for the period covered by the auditee’s financial statements, which must include the total federal awards expended, as determined in accordance with §200.502, Basis for Determining Federal Awards Expended. At a minimum, the schedule must provide total federal awards expended for each individual federal program and the CFDA number or other identifying number when the CFDA information is not available. For a cluster of programs, also provide the total for the cluster.
Condition: During the audit, we noted that the organization did not maintain a complete schedule of expenditures of federal awards.
Cause: The organization did not adequately track federal expenditures and the required information needed to prepare a schedule of expenditures of federal awards.
Effect: Failure to prepare an accurate and complete schedule of expenditures of federal awards results in noncompliance with 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Awards Requirements, Standards for Financial and Program Management, §200.302, Financial Management, and Subpart F – Audit Requirements, §200.510, Financial Statements.
Audit Recommendation: We recommend that the organization document and implement policies and procedures to ensure the schedule of expenditures of federal awards is accurate and complete in accordance with 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Awards Requirements, Standards for Financial and Program Management, §200.302, Financial Management and Subpart F – Audit Requirements, §200.510, Financial Statements, in order to obtain accurate calculations of major federal programs for the single audit and to ensure the organization is in compliance with all of the reporting requirements as to identify the source and application of funds for federally-funded activities.
Management’s Response: The SEFA was assigned to be prepared internally, but unfortunately was not submitted due to staff turnover during the course of the audit. This oversight will be corrected by improving procedures around internal task assignments when employee turnover is experienced in the Fiscal department during the course of the audit.