Finding Text
Program Information: U.S. Department of the Interior BIA Consolidated Tribal Government/ COVID-19 - ARPA ATTG & HIP Assistance Listing #: 15.021 Award Number: A20AV00601, A17AV00362, A20AV00601 Award Period: 1/1/2020-12/31/2023 Criteria: 2 CFR § 200.303 - Internal controls states, the recipient and subrecipient must: (a) 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). The cost principles in 2 CFR Part 200, subpart E (Cost Principles), prescribe the cost accounting requirements associated with the administration of Federal awards by: a. States, local governments, and Indian tribes. Except where otherwise authorized by statute, cost must meet the following general criteria in order to be allowable under Federal awards: 7. Be adequately documented. Condition/Context: During testing of non-payroll transactions, the following was noted: • For 4 of 23 non-payroll transactions (3 of 4 Individually Important Item (III) transactions tested and 1 of 19 samples tested), supporting documentation was insufficient to determine whether the gift cards purchased were spent properly for allowable costs. • For 1 of 23 non-payroll transactions, the expenditure tested represented an unallowable cost. [ X ] Compliance Finding [ ] Significant Deficiency [ X ] Material Weakness Cause: The Department did not have adequate internal controls in place to ensure that gift card purchases and other expense were sufficiently supported and restricted to allowable program purposes. Effect: As a result, there is an increased risk that Federal funds were used for unallowable purposes. Questioned Costs: Known – $48,929 Repeat Finding: No. Recommendation: We recommend the Department strengthen controls over the purchase and distribution of gift cards and require documentation demonstrating the business purpose and allowable use of all gift card expenditures. Additionally, the Department should review and approve all non-payroll expenditures for allowability prior to charging them to the Program. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has prepared corrective action as detailed in its Corrective Action Plan.