Finding Text
Federal Agency: Department of Agriculture
Federal Program Name: Communities Facilities Loans and Grants
Assistance Listing Number: 10.766
Federal Award Identification Number and Year: 61-001-237118628
Award Period: 2019-2049
Type of Findings: Significant Deficiency in Internal Control over Compliance
Criteria or specific requirement: The road project loan requires monthly transfers of $797.50 to the reserve fund until minimum balance of $95,700 is met.
Condition: There were no transfers made to the road project reserve fund during fiscal year 2024 and the minimum balance has not been met.
Context: A transfer was not made until December 2024, causing the Association to be behind on the required minimum transfers.
Cause: The Association did not make a transfer of funds until December 2024.
Effect: The Association will need to make additional transfers to the road project reserve fund in fiscal year 2025 to bring the required minimum transfers current.
Recommendation: We recommend the Association implement a process whereby transfers are set up to be automatically made on a monthly basis to ensure compliance with loan requirements.
Views of responsible officials: There is no disagreement with the finding.