Finding Text
Item 2023-007: Cash Management Identification of federal programs: Food Distribution Cluster, Assistance Listing Number 10.565, 10.568, and 10.569 Federal award grant number: 204645, 203684, 236829, and 229353 Federal agency: U.S. Department of Agriculture Pass-through entity: Minnesota Department of Health and Minnesota Department of Human Services Criteria: The Uniform Guidance (2 CFR 200.303) requires that nonfederal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to review and approve reimbursement requests. Condition: During our testing of cash management requirements, we noted that a review and an approval of the reimbursement requests were not performed prior to submission. Cause: Management did not perform a review and an approval of the reimbursement requests under this federal award program. Effect: Likelihood of inaccurate reimbursement requests is increased when there is no review and approval. Questioned costs: None Context: The population subject to cash management requirements included 14 reimbursement requests. The sample size of three was determined using the guidance in the AICPA Audit and Accounting Guide—Government Auditing Standards and Single Audits. We noted three instances in our sample size of three where there was no documentation showing that the reimbursement requests were reviewed and approved. There was no segregation of duties as one individual prepared, reviewed and submitted the requests for payment. Repeat finding: Yes Recommendation: We recommend that SHNLFB implement a procedure to review and approve reimbursement requests to ensure they are accurately submitted. Views of responsible officials of the auditee: SHNLFB concurs with this finding and a response is included in the corrective action plan.