Finding Text
U.S. Department of Environmental Protection Agency Passed through State Department of Natural Resources and Conservation FFAL# 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Reporting Material Non-compliance Material Weakness in Internal Control Criteria: • 2 CFR §200.303 requires non-federal entities to establish and maintain effective internal control over federal awards. • 2 CFR §200.328 requires recipients to submit accurate financial reports and maintain records that support the data reported. Condition: The District does not have documented internal controls over the preparation and review of federal financial reports. During our testing, we noted: • For one quarterly report, the District used an incorrect reporting period. • For both sampled reports, the District did not maintain the required supporting documentation in the reporting package to substantiate the amounts reported to the cognizant agency. Cause: The District has not implemented documented internal controls over the reporting process and did not ensure that supporting documentation was retained for amounts reported. Effect: Failure to maintain accurate reporting and supporting documentation increases the risk of noncompliance with Uniform Guidance and may result in questioned costs or misreporting to the cognizant agency. Questioned Costs: None to report. Context/Sampling: A nonstatistical sample of two reports were selected for testing. Repeat Finding from Prior Years: No. Recommendation: We recommend the District: • Develop and implement documented internal controls over the reporting process, including review procedures to ensure accuracy of reporting periods. • Maintain complete supporting documentation in the reporting package for all amounts reported to the cognizant agency. • Provide training to staff responsible for preparing and reviewing reports to ensure compliance with Uniform Guidance requirements. Views of Responsible Officials: Agree.