Finding Text
Criteria or Specific Requirement: 2 CFR 200.303(a) states that a nonfederal entity must "Establish and maintain effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the term and conditions of the federal award. These internal controls should be in compliance 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: Proper review and approval of reimbursement requests submitted to SPDA and financial as well as progress report submitted to all funders were not retained. Questioned Costs: None Context: In statistically valid samples, CliftonLarsonAllen LLP (CLA) tested eight reimbursement requests for cash management testing, five reimbursement request for indirect cost testing, four quarterly financial reports for matching, four performance reports for reporting, and five quarterly financial reports for reporting testing. Context: (Continued) All five reimbursement requests tested for cash management testing related to the funder SPDA and lacked sufficient documentation of review, although there was substantiating evidence of review, including meeting invite emails. One of five reimbursement requests tested for indirect costs testing related to the funder SPDA and lacked sufficient documentation of review, although there was substantiating evidence of review, including meeting invite emails. All reports tested for matching and reporting testing lacked sufficient documentation of review, although substantiating evidence, including meeting invite emails, were retained. Cause: Lack of adequate knowledge about what is considered sufficient review documentation. Effect: Without adequate controls in place to ensure reimbursement requests and financial/progress reports are accurate, there is an increased risk in inaccurate reimbursement requests as well as reports, which could result in misappropriation of funds. Repeat Finding: No Recommendation: CLA recommends that additional emphasis of documentary evidence of approvals be made, and such evidence obtained and retained by SFP as proof of oversight of expenditure of federal funds. This could include: signatures on reports, emails indicating review and approval from appropriate individuals, retention of meeting agendas and minutes to corroborate that review occurred during the meetings, etc. Views of Responsible Officials: There is no disagreement with the audit finding.