Finding Text
Finding 2025-009 – Reporting (Material Weakness and Noncompliance)(Repeat Finding) Identification of the Federal Program: Community Development Block Grants, ALN 14.218, Department of Housing and Urban Development (CDBG) and Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027, Department of the Treasury (CRF). Criteria: 2 CFR 200.328-330 establish the requirements of nonfederal entities for financial and performance reporting that include timely and accurate reporting. 2 CFR 200.303 requires nonfederal entities to establish, document and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Typical control procedures for reporting include having a supervisor review the submitted report and ensuring the work is performed and documented in a way that confirms the accuracy and completeness of all data and information included. Condition: We selected five reports for the two grant programs to test for compliance and controls over reporting requirements. No documentation of review or approval of the reports was available. For CDBG, 2 quarterly cash reports and the FY24 Consolidated Annual Performance and Evaluation Report (CAPER) were tested, one cash report was late. Cause: The City did not retain documentation of a review and approval of federal reports submitted. Effect: The City did not have appropriate controls in place over documentation of reporting requirements. Questioned Costs: None reported. Recommendation: We recommend the City strengthen its policies and procedures over the grant reporting process to ensure controls are properly implemented and working effectively. Views of Responsible Officials: The City agrees with the finding. See Management’s View and Corrective Action Plan included at the end of the report.