Finding Text
Finding No.: 2024 001 Federal Agency: U.S. Department of Housing and Urban Development Program Name: Economic Development Initiative, Community Project Funding, and Miscellaneous Grants Assistance Listing No.: 14.251 Federal Award Year: Funding periods between January 1, 2024 and December 31, 2024 Compliance Requirement: Reporting Finding Type: Significant Deficiency Criteria Article VI of the executed Grant Agreement states the following: "The Grantee must submit a performance report in DRGR on a semi annual basis and must include a complete Federal financial report as an attachment to each performance report in DRGR. Performance report shall consist of a narrative of work accomplished during the reporting period. During the Period of Performance, the Grantee must submit these reports in DRGR no later than 30 calendar days after the end of the six month reporting period." Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR 200), Uniform Administrative Requirements, Cost Principles, and Audit Requirements, Section 200.303(a) states that non federal entities must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms 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 During reporting testing, the auditors identified that two semi annual required reports for the 14.251 program during the year under audit were not filed within the 30 day calendar period identified in the grant agreement. Effect West End Neighborhood House, Inc. (the Organization) was not in compliance with reporting. Cause Due to lack of internal controls surrounding ensuring that reports were filed timely, both program reports filed during the period were filed outside of the 30 day calendar window. Questioned Costs There are no questioned costs related to the finding. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding This is not identified as a repeat finding. Recommendation We recommend that the Organization enhance its policies and procedures to ensure responsible program personnel timely files all performance reporting. View of Responsible Official Management experienced a miscommunication with its contractor regarding responsibility for preparing and submitting the required program performance report. When management reviewed the HUD reporting website, it appeared the reports were completed. Upon further review, it was identified that the contractor had not completed the filing and that the submit button had not been pushed. Management promptly prepared and submitted the reports. These reports were submitted in August and September 2025. To prevent future delays, management is updating its compliance procedures to include verification of the timely filing of all required reports.