Finding 1148122 (2023-002)

Significant Deficiency Repeat Finding
Requirement
L
Questioned Costs
-
Year
2023
Accepted
2025-07-21
Audit: 362617
Organization: City of Bloomington (IN)
Auditor: Crowe LLP

AI Summary

  • Core Issue: The City of Bloomington's reporting for the Coronavirus State and Local Fiscal Recovery Funds lacks clarity in distinguishing between subrecipients and vendor purchases.
  • Impacted Requirements: Compliance with the US Department of Treasury's reporting guidelines is compromised due to ineffective internal controls and lack of secondary review.
  • Recommended Follow-Up: Implement a multi-stage review process for federal data reports to accurately track subrecipient activities and expenditures.

Finding Text

FINDING 2023-002 Information on the federal program: Federal Agency: Department of the Treasury Pass-Through Entity: N/A – Direct Grant Federal Program: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) Assistance Listing Number: 21.027 Compliance Requirement: Reporting Audit Findings: Significant Deficiency Criteria: The US Department of Treasury’s Compliance and Reporting Guidance for State and Local Fiscal Recovery Funds requires quarterly project expenditure reports to be completed with the key line items: 1) Obligations and Expenditures 2) Subawards 3) Detailed information of any loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate for these same categories of loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient. Condition: City of Bloomington completed quarterly reporting in a timely manner substantiated by the City’s expenditure detail. However, management could not differentiate between subrecipients and standard vendor purchases. Cause: The City does not have an effective system of internal controls in place to effectively review CSLFRF reporting data prior to submission to the US Department of Treasury. Effect: Subrecipient expenditures and subawards on the quarterly data submissions were overstated. Questioned costs: There are no questioned costs. Context: During our testing procedures over CSLFRF reporting, we noted that segregation of duties is not present in the Federal reporting process. The Deputy Controller prepared and submitted the reports without a secondary review taking place. As a result, the City did not report expenditures for the grant that were consistent with the expenditures reported on the SEFA and could not properly identify subrecipient expenditures. Identification as a repeat finding, if applicable: Yes, finding 2022-003 in the prior year report. Recommendation: We recommend that the City implement a consistent multi-stage review process for federal data reports, which involves identifying and tracking subrecipient activity as well as expenditures by type. Views of responsible officials and planned corrective actions: Management acknowledges the finding. See management’s corrective action plan attached to this audit report.

Categories

Subrecipient Monitoring Reporting Internal Control / Segregation of Duties Procurement, Suspension & Debarment Significant Deficiency

Other Findings in this Audit

  • 571679 2023-001
    Material Weakness Repeat
  • 571680 2023-002
    Significant Deficiency Repeat
  • 571681 2023-003
    Significant Deficiency Repeat
  • 1148121 2023-001
    Material Weakness Repeat
  • 1148123 2023-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 Covid-19 - Coronavirus State and Local Fiscal Recovery Funds $5.59M
20.205 Highway Planning and Construction $323,969
16.922 Equitable Sharing Program $149,783
14.218 Community Development Block Grants/entitlement Grants $119,358
66.818 Brownfields Multipurpose, Assessment, Revolving Loan Fund, and Cleanup Cooperative Agreements $108,671
20.600 State and Community Highway Safety $18,736
20.608 Minimum Penalties for Repeat Offenders for Driving While Intoxicated $10,880
10.559 Summer Food Service Program for Children $10,646
14.169 Housing Counseling Assistance Program $7,446
14.239 Home Investment Partnerships Program $6,106
16.607 Bulletproof Vest Partnership Program $6,046
20.616 National Priority Safety Programs $4,998
16.543 Missing Children's Assistance $4,961
10.675 Urban and Community Forestry Program $4,400
16.738 Edward Byrne Memorial Justice Assistance Grant Program $3,184