Finding 1175349 (2025-005)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2025
Accepted
2026-02-25
Audit: 389053
Auditor: ARMANINO

AI Summary

  • Issue: The SEFA was not prepared correctly for both the prior and current years, leading to a material weakness.
  • Impact: This affects financial statements and compliance, indicating serious reporting issues.
  • Follow-up: Review and correct the SEFA preparation process to ensure accurate reporting moving forward.

Finding Text

Award Information: Economic Development Initiative - Community Project Funding—Assistance Listing No. 14.251; Grant No. B-23-CP-CA-0206; Reporting period—Year ended June 30, 2024 Material weakness: As discussed at Finding 2025-002, the SEFA was originally prepared improperly for the prior and current years. We consider this to be a financial statement and compliance finding.

Corrective Action Plan

Recommendation: We recommend the Organization develop and implement a formal SEFA preparation policy that includes: - A centralized tracking system for all federal and pass-through awards, including subaward documentation - Review of the draft SEFA by another individual with knowledge of Federal reporting requirements and grants received. Additional training on Uniform Guidance requirements would also be beneficial Action Taken: Accounting will implement a formal SEFA preparation process that includes the development of a centralized schedule to track direct and pass-through federal funding sources. The schedule will incorporate key data fields necessary to support SEFA reporting and compliance, including identification of pass-through entities and applicable expenditure thresholds. A formal review process will be implemented to provide for appropriate separation of duties, with one individual responsible for preparation and a separate individual responsible for review and approval.

Categories

Reporting Material Weakness

Other Findings in this Audit

  • 1175347 2025-005
    Material Weakness Repeat
  • 1175348 2025-006
    Material Weakness Repeat
  • 1175350 2025-006
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $421,367
14.889 CHOICE NEIGHBORHOODS IMPLEMENTATION GRANTS $78,518
14.252 SECTION 4 CAPACITY BUILDING FOR COMMUNITY DEVELOPMENT AND AFFORDABLE HOUSING $63,108
14.169 HOUSING COUNSELING ASSISTANCE PROGRAM $38,993