Finding 1169028 (2025-001)

Lack of Independent Review and Approval of Reporting Finding Type. Immaterial noncompliance; Significant Deficiency in Internal Control over Compliance (Reporting). Program. Economic Development Cluster; Economic Adjustment Assistance; U.S. Department of Commerce; ALN 11.307; Passed through SEMCA; Award Number EDA-HDQ-ARPBBB-2021-2006976. Criteria. Recipients of federal awards are required to report periodically on financial information, as specified by the 2 CFR 200 Compliance Supplement or grant agreement. Reported information should be supported by the entity's accounting records and subjected to an independent review and approval prior to submission in order to detect and correct any errors or omissions. Condition. The Foundation is required to submit semi-annual reports on the grant expenditures, and we noted that these reports are not subjected to an independent review and approval process. Cause. This condition was caused by the lack of understanding by program staff of the specific requirements of reporting. Effect. Although no reporting errors were found, the Foundation was exposed to an increased risk that the reports filed could contain errors and not be detected and corrected on a timely basis. Questioned Costs. No costs are required to be questioned as a result of this finding, inasmuch as no unallowable expenditures were noted. Recommendation. We recommend that the Foundation review its procedures for compiling financial data for external reporting purposes and develop an independent review process before report submission. View of Responsible Officials. Management agrees and has provided a corrective action plan.