Finding Text
Earmarking
Federal Agency: Department of Homeland Security
Federal Program Name: Disaster Grant Public Assistance (Presidentially Declared Disasters)
Assistance Listing Number: 97.036
Grant Award Number: 4337DR-FL-2024
Award Period: Various
Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters
Criteria: Compliance: 2 CFR 200.302(b)(3) states that records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in
compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the” Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Condition: Management costs requested and received from FEMA exceeded the 5% threshold.
Questioned Costs: $35,572.
Context: Received the total award amount for calculation of the 5% threshold. Compared to the management costs requested and received.
Cause: The County requested management fees unaware of the total expenditure amount.
Effect: Over request of management fees leads to unallowable costs.
Repeat finding: No
Recommendation: Provide clear, updated guidance and periodic training sessions on earmarking rules and how to apply them. Conduct reviews of earmarking compliance.
View responsible official and planned corrective actions: New procedures will be implemented that strengthen internal controls to ensure clear earmarking guidance and initial review of compliances.