Finding 1187261 (2025-003)

Material Weakness Repeat Finding
Requirement
C
Questioned Costs
-
Year
2025
Accepted
2026-03-26

AI Summary

  • Core Issue: Reimbursement requests lack proper documentation for preparation and approval.
  • Impacted Requirements: Internal policies for reimbursement procedures were not followed.
  • Recommended Follow-Up: Create a comprehensive system to ensure all reimbursement requests are properly documented.

Finding Text

2025-003 Reimbursement Request Approval Documentation – Significant Deficiency Criteria: Reimbursement requests should be prepared and approved by responsible officials of the Association who are noted in internal policies, and such procedures should be documented. Condition: During our testing, we noted that all reimbursement requests sampled did not contain documentation of the preparation and approval procedures. Cause: Undetermined. Effect: The Association did not follow their policy for preparation and approval of the reimbursement requests, which allows for the possibility of having such requests be for expenditures outside of the program or expenditure period. Recommendation: We recommend that the Association develops a more comprehensive system to ensure that all reimbursement requests have proper documentation to represent the preparation and approval process.

Corrective Action Plan

Finding 2025‐003 Reimbursement Request Approval Documentation ‐ Significant Deficiency Management Response: The Association acknowledges this finding and agrees that reimbursement request files should contain clearer documentation evidencing the preparation and approval process required under internal policy. Although reimbursement requests were prepared and submitted as part of routine grant administration, the supporting documentation did not consistently reflect the full preparation trail and approval record expected for audit purposes. Management has already identified the need to formalize this process and will implement a standardized reimbursement request file structure for all future reimbursement submissions. This process will include documentation showing who prepared the request, the date of preparation, the review and approval path, and the supporting expenditure records associated with the reimbursement period. Where applicable, the Association will incorporate a formal checklist or cover sheet to ensure each request file demonstrates compliance with internal procedures and grant requirements. Management does not believe the issue resulted from intentional noncompliance, but rather from inadequate documentation of a process that had been operationally performed. Even so, management agrees that documentation standards must be improved to reduce risk and strengthen compliance controls over federal reimbursement activity. The Association is committed to implementing this corrective action immediately for all future reimbursement requests to ensure that preparation and approval procedures are clearly evidenced and consistently retained. The draft audit notes that the comparable prior-year federal finding appears to be resolved, and management intends to similarly resolve this finding through standardized documentation and retention procedures. Responsible Official: Director / Business Manager Planned Corrective Action Date: Immediately for all reimbursement requests submitted after audit issuance

Categories

Cash Management Significant Deficiency

Other Findings in this Audit

  • 1187260 2025-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
20.509 FORMULA GRANTS FOR RURAL AREAS AND TRIBAL TRANSIT PROGRAM $772,305
20.526 BUSES AND BUS FACILITIES FORMULA, COMPETITIVE, AND LOW OR NO EMISSIONS PROGRAMS $684,151
93.569 COMMUNITY SERVICES BLOCK GRANT $477,983
20.600 STATE AND COMMUNITY HIGHWAY SAFETY $21,739