Finding Text
Finding Number 2024-004 – Inaccurate Schedule of Expenditures of Federal Awards Criteria Entities that receive federal grants or programs are required to know the source of all grants and awards as the requirements of the U.S. Office of Management and Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Final Rule (Uniform Guidance). Entities must be able to document the key components of the schedule of expenditures of federal awards. Condition The schedule of expenditures of federal awards provided by management was incomplete. It did not include all federal grants expended during the fiscal year.Context Management has all the information to complete the schedule of expenditures of federal awards in compliance with the Uniform Guidance but had inaccuracies discovered during audit procedures. Federal expenditures of $97,080 were excluded from the schedule but were determined to have been reported as spent during the fiscal year. An additional $51,388 was incorrectly reported as federal expenditures that was for state funding. There were also $1,072,724 in federal expenditures reported under an incorrect CFDA number within the Health Center Cluster. Cause In most cases, the grants were properly recorded in the financial statements but the portion that was federal was not clearly identified on the schedule of expenditures of federal awards. Effect The audit firm assisted with compiling all the necessary information to ensure the schedule of expenditures of federal awards was complete and accurate. In addition, if the error in federal awards had not been discovered, the result could have been inaccurate reporting of federal expenditures. Recommendation We recommend management review all grant agreements and correspondence from grantors to ensure the proper CFDA number and amount considered federal is included on the schedule of expenditures of federal awards. Management’s Response Management will prepare the schedule of expenditures of federal awards as part of the year end closing process each year to determine their audit requirements under the Uniform Guidance and provide the schedule and all backup used to prepare it to the audit firm during the financial audit process.