Finding Text
Identification as a Repeat Finding: No
Finding:
The Organization omitted the COVID-19 Economic Injury Disaster Assistance Loan (EIDL) from
the initial draft of the SEFA presented to auditors.
Criteria:
2 CFR 200.502 requires the auditee to report federal awards expended under loan programs
including the balance of loans from previous years at the beginning of the audit period for which the
Federal Government imposes continuing compliance requirements. The EIDL loan requires annual
reporting to the Small Business Administration (SBA) as noted in prior year Finding 2023-002.
Sample Size and Population:
Not applicable
Condition and Context:
The EIDL loan totaling $584,853 was omitted from the draft SEFA provided to auditors on May 15,
2025.
Effect:
Exclusion understated total federal awards by 8%, changing the preliminary major-program
determination and potentially reducing audit coverage below the required 40% threshold. Cause:
The Organization did not identify ongoing compliance requirements associated with the EIDL loan.
Management relied on SBA guidance that addresses PPP loans and other SBA programs but do not
mention COVID-19 Relief EIDL programs, indicating a training gap in award-specific
requirements.
Recommendations:
We recommend the Organization review loan agreements and program specific guidance for
continuing compliance requirements before removing federal loans from the SEFA.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644