Finding Text
Finding 2024-002: Material Weakness: Activities Allowed and Unallowed
Criteria: Section 1A of the grant agreement requires that the Credit Union expend its CDFI ERP Award in eligible activities including providing financial products in low-or moderate-income majority minority census tracts that are also ERP-Eligible geographies.
Condition: For the year ended September 30, 2024, First Financial Credit Union did not track on an individual loan basis the financial products provided under the grant’s eligible activities. Of the 40 loans selecting for testing, we found that all loans met the low-or moderate-income majority census tract requirement but only 53% loans met the ERP-Eligible geographies requirement. (The Credit Union met the Performance Goals outlined in Section 1A of the grant agreement).
Effect or potential effect: Performance goals as stipulated in the grant agreement may not be met or reported inaccurately.
Recommendation: Establish control procedures to identify and track eligible loans deployed during a grant performance period and reconcile the totals to the underlying loan date.
Questioned costs: None.
Views of responsible officials: Management agrees with the finding and has established procedures to identify eligible loans deployed in the eligible ERP-Eligible geographies. These loans will be reconciled to the underlying loan servicing systems.