FAC Explorer

Finding 1159571 (2023-009)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
$1
Year
2023
Accepted
2025-10-01
Audit: 370214
Organization: County of Montgomery (PA)
Auditor: Cliftonlarsonallen LLP

AI Summary

  • Core Issue: There was a significant deficiency in internal controls over compliance, leading to incorrect reporting of federal expenditures in the SEFA.
  • Impacted Requirements: The auditee failed to maintain effective internal controls as required by 2 CFR 200.303, resulting in the inclusion of 2022 expenditures in the 2023 totals.
  • Recommended Follow-Up: Management should review and improve the process for recording federal expenditures to ensure they are reported in the correct fiscal year.

Finding Text

Federal Agency: U.S. Department of the Treasury Federal Program Name: American Rescue Plan Act / Coronavirus State Fiscal Recovery Fund (ARPA) Assistance Listing Number: 21.027Federal Award Identification Number and Year: Various Pass-Through Agency: Pennsylvania Department of Health and Human Services Pass-Through Number(s): 2022-CG-01-39297, SLFRP3241, C000084584, 4100095388 Award Period: 1/1/2023 – 12/31/23 Type of Finding: Significant Deficiency in Internal Control Over ComplianceCriteria or Specific Requirement Uniform guidance requires the auditee to prepare a schedule of expenditures of federal awards (SEFA) which must include the total federal awards expended as determined in accordance with sub-section 200.502. 2 CFR 200.510. A non-federal entity must maintain effective internal control over the federal award (2 CFR 200.303).Condition and Context Policies and controls in place regarding the completeness of the SEFA were not properly functioning. Within the supporting listing of expenses relating to ARPA expenditures, multiple transactions were identified as 2022 fiscal year expenditures that were included in the in 2023 expenditure total. The County revised the 2023 SEFA to exclude the 2022 expenditures. Questioned Costs$381,675 Cause Controls ensuring that only federal expenditures incurred in the period from January 1, 2023 to December 31, 2023 were not operating as designed. Effect Potential inaccurate expenditure reporting in the SEFA. Repeat Finding No.Recommendation We recommend management should review the process of recording federal expenditures to determine expenditures are being included in the appropriate fiscal year.Views of Responsible Officials There is no disagreement with the audit finding and the County is in the process of implementing corrective procedures.

Corrective Action Plan

2023-009- Reporting Federal Agency: U.S. Department of the Treasury Federal Program Name: American Rescue Plan Act / Coronavirus State Fiscal Recovery Fund (ARPA) Assistance Listing Number: 23.027 Federal Award Identification Number and Year: Various Pass-Through Agency: Pennsylvania Department of Health and Human Services Pass-Through Number(s): Not Available Award Period: 1/1/2023 – 12/31/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Condition: Policies and controls in place regarding the completeness of the SEFA were not properly functioning. Within the supporting listing of expenses relating to ARPA expenditures, multiple transactions were identified as 2022 fiscal year expenditures that were included in the 2023 expenditure total. The County revised the 2023 SEFA to exclude the 2022 expenditures. Recommendation: We recommend management should review the process of recording federal expenditures to determine expenditures are being included in the appropriate fiscal year. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned and taken in response to finding: The reason for the finding’s recurrence is in part a result of the timing of when the finding was issued. For example, the 2022 Single Audit was issued in August 2024. At this point, the 2023 fiscal year was already complete. Additionally, the implementation of corrective actions are in progress, including providing training, oversight and guidance to departments administering the grants, but these efforts take time to complete and/or are ongoing. A Deputy Controller of Grant Accounting was hired in February 2023, and a Manager-Grant Accounting was hired in July 2024, after working in this capacity as a temporary staff member since mid-2023. The County approved an additional full-time grant accounting position in May 2025 and will begin recruiting for this position in June 2025. These positions are responsible for establishing accounting policies based on best practices for grant-related activities, developing and providing training and resources to grant- funded departments, reviewing grant-related accounting in the Infor system, preparation of the annual SEFA, and assisting in the facilitation and preparation of documents needed for the Single Audit. The work performed by these positions had been vacant since the departure of Internal Audit Staff who helped General Accounting prior to the 2021 audit as well as the SEFA. Several changes have been made since the grant accounting team was created including the following: The grant accounting team is developing streamlined and standardized SEFA templates for each department for SEFA preparation. The expenditures reported on each SEFA are being compared to the financial information in the GL where possible to ensure all appropriate expenditures are included. Additionally, we are incorporating tracking of lifetime grant expenditures into the SEFA process to ensure no expenditures are missed due to cut off or timing issues. In 2023, the grant accounting team created a Montgomery County Grant Repository. This repository is used to store all grant agreements awarded to the County. Departments submit grant information to the repository upon notification of grant award. The grant accounting team reviews the Grant Repository when preparing the SEFA to ensure no grant programs are inadvertently left off of the SEFA. Additionally, the availability of the Grant Repository enables members of the accounting, finance and grant departments to quickly access grant award information when needed for audits, reporting, or other requirements. The grant accounting team is continuing to review and update the County’s Grant Accounting policies and is working closely with departments to understand their utilization of Infor to account for grant- related activities. As these policies are formalized, we will continue to provide training and resources; in late 2023, the County hired an outside trainer to provide an in-depth training on the accrual method of accounting, grant accruals, and the treatment of grant revenue. The Grant Accountant provided training in April 2024 to explain and outline the SEFA and Single Audit processes. Grant-funded departments received a two-day training on utilization of the Grant Management components of Infor in February 2024. We are also providing guidance and education to departments on the differences in timing of various grant fiscal years and how these impact the financial audit, SEFA and Single Audit. For example, departments must understand how to report expenditures and receipts in the correct period regardless of the fiscal year associated to the contract (State: July-June; Federal: October-September; County: January-December) and understand how these amounts reconcile to the amounts reported to the funding agencies. The accounting department continues to work with departments to emphasize the importance of submitting financial documentation timely and reviewing what is in the General Ledger promptly at the end of each month. The Finance department is performing quarterly reviews with departments to go over financial status, including grant financials. Departments are continuing to utilize Project Codes and other components of Infor’s Grant Management System to ensure the proper accounting of grant-related expenses, receipts, and revenues in the GL. Name(s) of the contact person(s) responsible for corrective action: Thomas Landauer and Fonta Reilly Planned completion date for corrective action plan: September 2025

Categories

Questioned Costs Reporting

Other Findings in this Audit

  • 1159479 2023-007
    Material Weakness Repeat
  • 1159480 2023-007
    Material Weakness Repeat
  • 1159481 2023-007
    Material Weakness Repeat
  • 1159482 2023-007
    Material Weakness Repeat
  • 1159483 2023-007
    Material Weakness Repeat
  • 1159484 2023-007
    Material Weakness Repeat
  • 1159485 2023-007
    Material Weakness Repeat
  • 1159486 2023-007
    Material Weakness Repeat
  • 1159487 2023-007
    Material Weakness Repeat
  • 1159488 2023-007
    Material Weakness Repeat
  • 1159489 2023-007
    Material Weakness Repeat
  • 1159490 2023-007
    Material Weakness Repeat
  • 1159491 2023-007
    Material Weakness Repeat
  • 1159492 2023-007
    Material Weakness Repeat
  • 1159493 2023-007
    Material Weakness Repeat
  • 1159494 2023-007
    Material Weakness Repeat
  • 1159495 2023-007
    Material Weakness Repeat
  • 1159496 2023-007
    Material Weakness Repeat
  • 1159497 2023-007
    Material Weakness Repeat
  • 1159498 2023-007
    Material Weakness Repeat
  • 1159499 2023-007
    Material Weakness Repeat
  • 1159500 2023-007
    Material Weakness Repeat
  • 1159501 2023-007
    Material Weakness Repeat
  • 1159502 2023-007
    Material Weakness Repeat
  • 1159503 2023-007
    Material Weakness Repeat
  • 1159504 2023-007
    Material Weakness Repeat
  • 1159505 2023-007
    Material Weakness Repeat
  • 1159506 2023-007
    Material Weakness Repeat
  • 1159507 2023-007
    Material Weakness Repeat
  • 1159508 2023-007
    Material Weakness Repeat
  • 1159509 2023-007
    Material Weakness Repeat
  • 1159510 2023-007
    Material Weakness Repeat
  • 1159511 2023-007
    Material Weakness Repeat
  • 1159512 2023-007
    Material Weakness Repeat
  • 1159513 2023-007
    Material Weakness Repeat
  • 1159514 2023-007
    Material Weakness Repeat
  • 1159515 2023-007
    Material Weakness Repeat
  • 1159516 2023-007
    Material Weakness Repeat
  • 1159517 2023-007
    Material Weakness Repeat
  • 1159518 2023-007
    Material Weakness Repeat
  • 1159519 2023-007
    Material Weakness Repeat
  • 1159520 2023-007
    Material Weakness Repeat
  • 1159521 2023-007
    Material Weakness Repeat
  • 1159522 2023-007
    Material Weakness Repeat
  • 1159523 2023-007
    Material Weakness Repeat
  • 1159524 2023-007
    Material Weakness Repeat
  • 1159525 2023-007
    Material Weakness Repeat
  • 1159526 2023-007
    Material Weakness Repeat
  • 1159527 2023-007
    Material Weakness Repeat
  • 1159528 2023-007
    Material Weakness Repeat
  • 1159529 2023-007
    Material Weakness Repeat
  • 1159530 2023-007
    Material Weakness Repeat
  • 1159531 2023-007
    Material Weakness Repeat
  • 1159532 2023-007
    Material Weakness Repeat
  • 1159533 2023-007
    Material Weakness Repeat
  • 1159534 2023-007
    Material Weakness Repeat
  • 1159535 2023-007
    Material Weakness Repeat
  • 1159536 2023-007
    Material Weakness Repeat
  • 1159537 2023-007
    Material Weakness Repeat
  • 1159538 2023-007
    Material Weakness Repeat
  • 1159539 2023-007
    Material Weakness Repeat
  • 1159540 2023-007
    Material Weakness Repeat
  • 1159541 2023-007
    Material Weakness Repeat
  • 1159542 2023-007
    Material Weakness Repeat
  • 1159543 2023-007
    Material Weakness Repeat
  • 1159544 2023-007
    Material Weakness Repeat
  • 1159545 2023-007
    Material Weakness Repeat
  • 1159546 2023-007
    Material Weakness Repeat
  • 1159547 2023-007
    Material Weakness Repeat
  • 1159548 2023-007
    Material Weakness Repeat
  • 1159549 2023-007
    Material Weakness Repeat
  • 1159550 2023-007
    Material Weakness Repeat
  • 1159551 2023-007
    Material Weakness Repeat
  • 1159552 2023-007
    Material Weakness Repeat
  • 1159553 2023-007
    Material Weakness Repeat
  • 1159554 2023-007
    Material Weakness Repeat
  • 1159555 2023-007
    Material Weakness Repeat
  • 1159556 2023-007
    Material Weakness Repeat
  • 1159557 2023-007
    Material Weakness Repeat
  • 1159558 2023-007
    Material Weakness Repeat
  • 1159559 2023-007
    Material Weakness Repeat
  • 1159560 2023-007
    Material Weakness Repeat
  • 1159561 2023-007
    Material Weakness Repeat
  • 1159562 2023-007
    Material Weakness Repeat
  • 1159563 2023-008
    Material Weakness Repeat
  • 1159564 2023-008
    Material Weakness Repeat
  • 1159565 2023-008
    Material Weakness Repeat
  • 1159566 2023-009
    Material Weakness Repeat
  • 1159567 2023-009
    Material Weakness Repeat
  • 1159568 2023-009
    Material Weakness Repeat
  • 1159569 2023-009
    Material Weakness Repeat
  • 1159570 2023-009
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
21.023 Emergency Rental Assistance Program $13.39M
93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund $5.44M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $3.06M
93.563 Child Support Services $1.01M
14.900 Lead Hazard Reduction Grant Program $660,493
93.558 Temporary Assistance for Needy Families $652,259
10.569 Emergency Food Assistance Program (food Commodities) $498,514
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $453,531
93.788 Opioid Str $411,770
93.045 Special Programs for the Aging, Title Iii, Part C, Nutrition Services $311,116
93.959 Block Grants for Prevention and Treatment of Substance Abuse $309,904
16.922 Equitable Sharing Program $305,151
93.053 Nutrition Services Incentive Program $295,623
14.218 Community Development Block Grants/entitlement Grants $289,454
16.839 Stop School Violence $266,422
93.268 Immunization Cooperative Agreements $242,721
93.667 Social Services Block Grant $241,989
93.069 Public Health Emergency Preparedness $233,536
16.838 Comprehensive Opioid, Stimulant, and Other Substances Use Program $198,904
84.181 Special Education-Grants for Infants and Families $189,899
93.958 Block Grants for Community Mental Health Services $170,052
93.991 Preventive Health and Health Services Block Grant $151,722
97.067 Homeland Security Grant Program $141,323
16.575 Crime Victim Assistance $135,134
10.568 Emergency Food Assistance Program (administrative Costs) $115,261
17.277 Wioa National Dislocated Worker Grants / Wia National Emergency Grants $108,903
93.674 John H. Chafee Foster Care Program for Successful Transition to Adulthood $104,165
93.994 Maternal and Child Health Services Block Grant to the States $103,278
21.032 Local Assistance and Tribal Consistency Fund $100,000
20.205 Highway Planning and Construction $93,312
97.042 Emergency Management Performance Grants $72,609
93.052 National Family Caregiver Support, Title Iii, Part E $69,961
21.027 Coronavirus State and Local Fiscal Recovery Funds $69,616
93.071 Medicare Enrollment Assistance Program $64,247
93.575 Child Care and Development Block Grant $62,209
93.645 Stephanie Tubbs Jones Child Welfare Services Program $59,024
93.043 Special Programs for the Aging, Title Iii, Part D, Disease Prevention and Health Promotion Services $47,894
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $44,445
20.505 Metropolitan Transportation Planning and State and Non-Metropolitan Planning and Research $40,387
20.600 State and Community Highway Safety $40,102
93.150 Projects for Assistance in Transition From Homelessness (path) $39,999
17.258 Wioa Adult Program $39,927
93.669 Child Abuse and Neglect State Grants $37,504
93.779 Centers for Medicare and Medicaid Services (cms) Research, Demonstrations and Evaluations $31,387
10.553 School Breakfast Program $30,408
93.940 Hiv Prevention Activities Health Department Based $27,885
14.239 Home Investment Partnerships Program $26,994
93.136 Injury Prevention and Control Research and State and Community Based Programs $26,861
16.606 State Criminal Alien Assistance Program $26,709
14.267 Continuum of Care Program $25,272
93.044 Special Programs for the Aging, Title Iii, Part B, Grants for Supportive Services and Senior Centers $20,948
93.778 Medical Assistance Program $18,408
93.042 Special Programs for the Aging, Title Vii, Chapter 2, Long Term Care Ombudsman Services for Older Individuals $17,967
93.967 Centers for Disease Control and Prevention Collaboration with Academia to Strengthen Public Health $14,541
93.556 Marylee Allen Promoting Safe and Stable Families Program $13,435
93.116 Project Grants and Cooperative Agreements for Tuberculosis Control Programs $11,849
93.324 State Health Insurance Assistance Program $11,828
95.001 High Intensity Drug Trafficking Areas Program $8,640
93.041 Special Programs for the Aging, Title Vii, Chapter 3, Programs for Prevention of Elder Abuse, Neglect, and Exploitation $8,366
93.472 Title IV-E Prevention Program $8,316
97.024 Emergency Food and Shelter National Board Program $7,061
93.197 Childhood Lead Poisoning Prevention Projects, State and Local Childhood Lead Poisoning Prevention and Surveillance of Blood Lead Levels in Children $6,070
93.658 Foster Care Title IV-E $5,485
14.231 Emergency Solutions Grant Program $4,315
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $3,547
93.659 Adoption Assistance $3,014
17.278 Wioa Dislocated Worker Formula Grants $1,752
10.555 National School Lunch Program $653
93.090 Guardianship Assistance $55
17.283 Workforce Innovation Fund $6
17.259 Wioa Youth Activities $1