Finding 1140957 (2024-002)

Significant Deficiency
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-06-12

AI Summary

  • Core Issue: The Schedule of Expenditures of Federal Awards (SEFA) had significant inaccuracies, including omitted programs and misclassified expenditures.
  • Impacted Requirements: Compliance with 2 CFR §200.510(b) was not met, risking noncompliance with Federal reporting standards.
  • Recommended Follow-Up: Establish formal procedures for SEFA preparation, including reconciliation, supervisory review, and staff training on compliance requirements.

Finding Text

Finding 2024-002: Preparation of the Schedule of Expenditures of Federal Awards (SEFA) Federal Agency: Department of Labor, U. S. Department of Treasury, U.S. Department of Agriculture, U.S. Department of Health and Human Services Administration Federal Program: Grads2Careers, Center for Sustainable Careers - Building Pathways, Center for Sustainable Careers - Critical Sector Job Quality, Baltimore Shines, Clean Corps, Baltimore Community Canopy Initiative, Administration for Community Living Grant Assistance Listing Numbers: 21.027, 17.268, 17.280, 10.727, 93.071 Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: Per 2 CFR §200.510(b), the auditee must prepare a SEFA that includes total Federal expenditures, the name of the Federal agency, the Assistance Listing Number, and other identifying information. The SEFA must be accurate, complete, and prepared in accordance with the Uniform Guidance to facilitate the Single Audit. Condition: During our audit of the SEFA for the year ended September 30, 2024, we noted that the initial SEFA provided by management contained material inaccuracies. Specifically, we noted that certain programs were omitted entirely, several expenditures were incorrectly classified under the wrong Assistance Listing Number, and certain programs had expenditures that were inaccurately reported. Cause: The inaccuracies in the SEFA were primarily due to a lack of formalized procedures and oversight in the SEFA preparation process. Management relied on manual compilation without a reconciliation or review step. Effect or Potential Effect: An incomplete or inaccurate SEFA may result in inadequate audit coverage, potential noncompliance with Federal reporting requirements, and increased risk of questioned costs or funding disallowances. Questioned Costs: None Context: The initial SEFA provided for audit included approximately $8.4 million in Federal expenditures. During the audit process, audit procedures identified approximately $1.05 million in Federal expenditures that were omitted, as well as classification errors affecting roughly 10% of the total reported expenditures. The SEFA was subsequently revised and corrected by management. Identification as a Repeat Finding: Not applicable Recommendation: We recommend that management implement formal procedures for compiling the SEFA, including a reconciliation of expenditures to the general ledger, review of all grant agreements for required disclosures, and a documented supervisory review prior to finalization. Staff involved in Federal grant reporting should also receive training on SEFA requirements under Uniform Guidance.

Categories

Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

  • 564512 2024-002
    Significant Deficiency
  • 564513 2024-002
    Significant Deficiency
  • 564514 2024-002
    Significant Deficiency
  • 564515 2024-002
    Significant Deficiency
  • 564516 2024-002
    Significant Deficiency
  • 564517 2024-002
    Significant Deficiency
  • 1140954 2024-002
    Significant Deficiency
  • 1140955 2024-002
    Significant Deficiency
  • 1140956 2024-002
    Significant Deficiency
  • 1140958 2024-002
    Significant Deficiency
  • 1140959 2024-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $3.14M
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $1.26M
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $1.20M
17.274 Youthbuild $696,314
94.006 Americorps State and National 94.006 $434,975
21.019 Coronavirus Relief Fund $317,643
17.280 Wioa Dislocated Worker National Reserve Demonstration Grants $172,695
14.218 Community Development Block Grants/entitlement Grants $158,691
66.815 Brownfields Job Training Cooperative Agreements $124,175
17.270 Reentry Employment Opportunities $87,534
17.259 Wioa Youth Activities $60,000
17.268 H-1b Job Training Grants $57,281
10.727 Inflation Reduction Act Urban & Community Forestry Program $55,775
17.289 Community Project Funding/congressionally Directed Spending $30,081
17.277 Wioa National Dislocated Worker Grants / Wia National Emergency Grants $5,109
93.071 Medicare Enrollment Assistance Program $2,366