FAC Explorer

Finding 1201445 (2025-001)

Material Weakness Repeat Finding
Requirement
P
Questioned Costs
-
Year
2025
Accepted
2026-03-30
Audit: 395982
Organization: County of Orange, California (CA)
Auditor: EIDE BAILLY LLP

AI Summary

  • Core Issue: The County has a material weakness in internal controls over federal award compliance, leading to significant overstatements in reported expenditures.
  • Impacted Requirements: Compliance with Uniform Guidance §200.510(b) for preparing the Schedule of Expenditures of Federal Awards (SEFA) and ensuring accurate reporting of federal funds.
  • Recommended Follow-Up: Departments must enhance internal controls, ensure accurate tracking of expenditures, and conduct timely reviews of the SEFA against supporting records.

Finding Text

Program: Congressionally Recommended Awards / HOME Investment Partnerships Program / Homeland Security Grant Program / Epidemiology and Laboratory Capacity for Infectious Disease Federal Financial Assistance Listing Number: 16.753 / 14.239 / 97.067 / 93.323 Federal Grantor: U.S. Department of Justice / U.S. Department of Housing and Urban Development / U.S. Department of Homeland Security / U.S. Department of Health and Human Services Award No. and Year: Multiple Compliance Requirements: Other – Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.510(b) - Schedule of Expenditures of Federal awards Type of Finding: Material Weakness in Internal Control Over Compliance Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.510(b) states that the auditee (the County) must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee’s financial statements, which must include the total federal awards expended as determined in accordance with §200.502. §200.331 of the Uniform Guidance states the County is responsible for making case-by-case determinations to determine whether the entity receiving the Federal funds is a subrecipient. In addition, §200.303 of the Uniform Guidance states that the County must establish and maintain effective internal control over the federal awards, including controls over the accuracy of program information and expenditure amounts. Condition: During our audit procedures performed over the SEFA we noted the following: • The Sheriff-Coroner Department did not properly identify the amount expended for the Congressionally Recommended Awards, AL No. 16.753. The expenditures reported by the Department were overstated by $2,638,516. • The Orange County Community Resources Department did not properly identify the amount of Federal funding passed through to subrecipients for the HOME Investment Partnerships Program, AL No. 14.239. The amount passed through to subrecipients reported by the Department was overstated by $4,500,624. • The Sheriff-Coroner Department did not properly identify the amounts expended for the Homeland Security Grant Program, AL No. 97.067. The expenditures reported by the Department were overstated by $715,489. • The Orange County Health Care Agency (HCA) did not properly identify the amount expended for the Epidemiology and Laboratory Capacity for Infectious Disease program, AL No. 93.323. The expenditures reported by the Agency were overstated by $486,000. Cause: As a result, the County lacked adequate internal controls to ensure the SEFA is completely and accurately stated. Specifically, the County’s processes for recording and tracking expenditures of Federal awards are not designed so that expenditures are identified when incurred. In addition, the County’s processes for identifying and reporting subrecipients are not designed to ensure appropriate reporting on the SEFA. Effect: Adjustments to the SEFA were required. Questioned Costs: No questioned costs were identified as a result of our procedures. Context/Sampling: No sampling was used. Program expenditures and amounts passed through to subrecipients were reconciled to the supporting records. Repeat Finding from Prior Years: No. Recommendation: The County, including all its reporting departments, should follow existing policies, procedures and internal controls to ensure all expenditures and amounts passed through to subrecipients are accurately tracked and reported on the SEFA. Personnel knowledgeable of federal expenditures should review amounts coded to federal programs for completeness and accuracy. The SEFA should be prepared and reviewed in a timely manner and reconciled to underlying records as well as the basic financial statements. Views of Responsible Officials: See separately issued Corrective Action Plan.

Corrective Action Plan

Program: Congressionally Recommended Awards / HOME Investment Partnerships Program / Homeland Security Grant Program / Epidemiology and Laboratory Capacity for Infectious Disease Federal Financial Assistance Listing Number: 16.753 / 14.239 / 97.067 / 93.323 Federal Grantor: U.S. Department of Justice / U.S. Department of Housing and Urban Development / U.S. Department of Homeland Security / U.S. Department of Health and Human Services Award No. and Year: Multiple Compliance Requirements: Other – Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.510(b) - Schedule of expenditures of Federal awards Type of Finding: Material Weakness in Internal Control Over Compliance Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.510(b) states that the auditee (the County) must prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee’s financial statements, which must include the total federal awards expended as determined in accordance with §200.502. §200.331 of the Uniform Guidance states the County is responsible for making case-by-case determinations to determine whether the entity receiving the Federal funds is a subrecipient. In addition, §200.303 of the Uniform Guidance states that the County must establish and maintain effective internal control over the federal awards, including controls over the accuracy of program information and expenditure amounts. Condition: During our audit procedures performed over the SEFA we noted the following: • The Sheriff-Coroner Department did not properly identify the amount expended for the Congressionally Recommended Awards, AL No. 16.753. The expenditures reported by the Department were overstated by $2,638,516. • The Orange County Community Resources Department did not properly identify the amount of Federal funding passed through to subrecipients for the HOME Investment Partnerships Program, AL No. 14.239. The amount passed through to subrecipients reported by the Department was overstated by $4,500,624. • The Sheriff-Coroner Department did not properly identify the amounts expended for the Homeland Security Grant Program, AL No. 97.067. The expenditures reported by the Department were overstated by $715,489. • The Orange County Health Care Agency (HCA) did not properly identify the amount expended for the Epidemiology and Laboratory Capacity for Infectious Disease program, AL No. 93.323. The expenditures reported by the Agency were overstated by $486,000. Cause: As a result, the County lacked adequate internal controls to ensure the SEFA is completely and accurately stated. Specifically, the County’s processes for recording and tracking expenditures of Federal awards are not designed so that expenditures are identified when incurred. In addition, the County’s processes for identifying and reporting subrecipients are not designed to ensure appropriate reporting on the SEFA. Effect: Adjustments to the SEFA were required. Questioned Costs: No questioned costs were identified as a result of our procedures. Context/Sampling: No sampling was used. Program expenditures and amounts passed through to subrecipients were reconciled to the supporting records. Repeat Finding from Prior Years: No. Recommendation: The County, including all its reporting departments, should follow existing policies, procedures and internal controls to ensure all expenditures and amounts passed through to subrecipients are accurately tracked and reported on the SEFA. Personnel knowledgeable of federal expenditures should review amounts coded to federal programs for completeness and accuracy. The SEFA should be prepared and reviewed in a timely manner and reconciled to underlying records as well as the basic financial statements. Management Response and Corrective Action Plan: Health Care Agency: 1. Person Responsible: David Santalahti, HCA Claims & Financial Reporting Manager 2. Corrective action plan: HCA Accounting will review and enhance its procedures and training for analysis and tracking federal award expenditures to ensure expenditures are reported in the appropriate fiscal year period. 3. Anticipated Implementation date: June 30, 2026 Orange County Community Resources: 1. Person Responsible: Bill Malohn, OCCR Accounting Manager 2. Corrective action plan: Concur. OCCR has established policies and internal controls to ensure all expenditures and amounts passed through to subrecipients are accurately tracked and reported on the SEFA. Appropriate personnel review amounts coded to federal programs for completeness and accuracy. We prepare and review the SEFA in a timely manner and reconcile to underlying records as well as the basic financial statements. In this particular situation, we miscategorized one provider as a subrecipient and reported the related funding as such on the SEFA. This oversight had no impact on the total amount we reported on the SEFA. We will be sure to follow our policies and procedures to ensure accurate SEFA reporting. 3. Anticipated Implementation date: February 2, 2026 Sheriff-Coroner: 1. Person Responsible: Monique Vansuch, Fiscal Administrator 2. Corrective action plan: The Sheriff-Coroner Department acknowledges the finding and recognized federal grant expenditure incurred is defined as when expenditures are delivered and/or services are performed rather than when the expenditures are paid. We will strengthen the internal controls to ensure grant expenditures are reported per the Uniform Guidance. 3. Anticipated Implementation date: June 30, 2026

Categories

Reporting

Other Findings in this Audit

  • 1201405 2025-004
    Material Weakness Repeat
  • 1201406 2025-001
    Material Weakness Repeat
  • 1201407 2025-002
    Material Weakness Repeat
  • 1201408 2025-001
    Material Weakness Repeat
  • 1201409 2025-002
    Material Weakness Repeat
  • 1201410 2025-001
    Material Weakness Repeat
  • 1201411 2025-002
    Material Weakness Repeat
  • 1201412 2025-001
    Material Weakness Repeat
  • 1201413 2025-002
    Material Weakness Repeat
  • 1201414 2025-008
    Material Weakness Repeat
  • 1201415 2025-008
    Material Weakness Repeat
  • 1201416 2025-008
    Material Weakness Repeat
  • 1201417 2025-008
    Material Weakness Repeat
  • 1201418 2025-005
    Material Weakness Repeat
  • 1201419 2025-005
    Material Weakness Repeat
  • 1201420 2025-006
    Material Weakness Repeat
  • 1201421 2025-006
    Material Weakness Repeat
  • 1201422 2025-001
    Material Weakness Repeat
  • 1201423 2025-009
    Material Weakness Repeat
  • 1201424 2025-001
    Material Weakness Repeat
  • 1201425 2025-009
    Material Weakness Repeat
  • 1201426 2025-001
    Material Weakness Repeat
  • 1201427 2025-009
    Material Weakness Repeat
  • 1201428 2025-001
    Material Weakness Repeat
  • 1201429 2025-009
    Material Weakness Repeat
  • 1201430 2025-001
    Material Weakness Repeat
  • 1201431 2025-009
    Material Weakness Repeat
  • 1201432 2025-001
    Material Weakness Repeat
  • 1201433 2025-009
    Material Weakness Repeat
  • 1201434 2025-001
    Material Weakness Repeat
  • 1201435 2025-009
    Material Weakness Repeat
  • 1201436 2025-003
    Material Weakness Repeat
  • 1201437 2025-003
    Material Weakness Repeat
  • 1201438 2025-003
    Material Weakness Repeat
  • 1201439 2025-001
    Material Weakness Repeat
  • 1201440 2025-001
    Material Weakness Repeat
  • 1201441 2025-007
    Material Weakness Repeat
  • 1201442 2025-007
    Material Weakness Repeat
  • 1201443 2025-007
    Material Weakness Repeat
  • 1201444 2025-007
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 SECTION 8 HOUSING CHOICE VOUCHERS $227.21M
12.U01 SANTA ANA RIVER MAINSTEM PROJECT - PRADO DAM CONSTRUCTION $63.03M
93.959 BLOCK GRANTS FOR PREVENTION AND TREATMENT OF SUBSTANCE ABUSE $19.06M
93.778 MEDICAL ASSISTANCE PROGRAM $16.90M
93.658 FOSTER CARE TITLE IV-E $12.77M
93.667 SOCIAL SERVICES BLOCK GRANT $10.75M
93.268 COVID- 19 IMMUNIZATION COOPERATIVE AGREEMENTS $8.13M
93.914 HIV EMERGENCY RELIEF PROJECT GRANTS $6.63M
93.967 CENTERS FOR DISEASE CONTROL AND PREVENTION COLLABORATION WITH ACADEMIA TO STRENGTHEN PUBLIC HEALTH $6.05M
10.557 WIC SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, AND CHILDREN $4.49M
14.879 MAINSTREAM VOUCHERS $4.46M
93.045 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $3.87M
20.205 HIGHWAY PLANNING AND CONSTRUCTION $3.82M
93.069 PUBLIC HEALTH EMERGENCY PREPAREDNESS $3.57M
20.106 AIRPORT IMPROVEMENT PROGRAM, INFRASTRUCTURE INVESTMENT AND JOBS ACT PROGRAMS, AND COVID-19 AIRPORTS PROGRAMS $3.53M
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $3.44M
93.958 BLOCK GRANTS FOR COMMUNITY MENTAL HEALTH SERVICES $3.42M
93.659 ADOPTION ASSISTANCE $3.21M
93.044 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART B, GRANTS FOR SUPPORTIVE SERVICES AND SENIOR CENTERS $3.11M
93.556 MARYLEE ALLEN PROMOTING SAFE AND STABLE FAMILIES PROGRAM $2.94M
93.994 MATERNAL AND CHILD HEALTH SERVICES BLOCK GRANT TO THE STATES $2.90M
14.239 HOME INVESTMENT PARTNERSHIPS PROGRAM $2.88M
17.258 WIOA ADULT PROGRAM $2.33M
93.563 CHILD SUPPORT SERVICES $2.15M
14.239 COVID- 19 HOME INVESTMENT PARTNERSHIPS PROGRAM $1.94M
93.917 HIV CARE FORMULA GRANTS $1.84M
17.278 WIOA DISLOCATED WORKER FORMULA GRANTS $1.79M
93.645 STEPHANIE TUBBS JONES CHILD WELFARE SERVICES PROGRAM $1.71M
16.922 EQUITABLE SHARING PROGRAM $1.62M
97.036 COVID- 19 DISASTER GRANTS - PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS) $1.58M
93.052 NATIONAL FAMILY CAREGIVER SUPPORT, TITLE III, PART E $1.56M
93.566 REFUGEE AND ENTRANT ASSISTANCE STATE/REPLACEMENT DESIGNEE ADMINISTERED PROGRAMS $1.46M
14.267 CONTINUUM OF CARE PROGRAM $1.37M
93.686 ENDING THE HIV EPIDEMIC: A PLAN FOR AMERICA — RYAN WHITE HIV/AIDS PROGRAM PARTS A AND B $1.29M
16.575 CRIME VICTIM ASSISTANCE $1.29M
95.001 HIGH INTENSITY DRUG TRAFFICKING AREAS PROGRAM $1.26M
20.616 NATIONAL PRIORITY SAFETY PROGRAMS $1.16M
93.889 NATIONAL BIOTERRORISM HOSPITAL PREPAREDNESS PROGRAM $1.15M
14.241 HOUSING OPPORTUNITIES FOR PERSONS WITH AIDS $905,766
17.235 SENIOR COMMUNITY SERVICE EMPLOYMENT PROGRAM $904,032
93.940 HIV PREVENTION ACTIVITIES HEALTH DEPARTMENT BASED $783,072
97.042 EMERGENCY MANAGEMENT PERFORMANCE GRANTS $750,854
93.767 CHILDREN'S HEALTH INSURANCE PROGRAM $717,458
93.918 GRANTS TO PROVIDE OUTPATIENT EARLY INTERVENTION SERVICES WITH RESPECT TO HIV DISEASE $689,428
93.268 IMMUNIZATION COOPERATIVE AGREEMENTS $641,855
93.116 PROJECT GRANTS AND COOPERATIVE AGREEMENTS FOR TUBERCULOSIS CONTROL PROGRAMS $619,258
16.753 CONGRESSIONALLY RECOMMENDED AWARDS $565,522
93.674 JOHN H. CHAFEE FOSTER CARE PROGRAM FOR SUCCESSFUL TRANSITION TO ADULTHOOD $517,178
93.590 COMMUNITY-BASED CHILD ABUSE PREVENTION GRANTS $463,154
93.044 COVID- 19 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART B, GRANTS FOR SUPPORTIVE SERVICES AND SENIOR CENTERS $407,064
14.896 FAMILY SELF-SUFFICIENCY PROGRAM $400,275
14.231 EMERGENCY SOLUTIONS GRANT PROGRAM $393,883
17.259 WIOA YOUTH ACTIVITIES $362,064
93.053 NUTRITION SERVICES INCENTIVE PROGRAM $337,821
16.741 DNA BACKLOG REDUCTION PROGRAM $324,527
10.025 PLANT AND ANIMAL DISEASE, PEST CONTROL, AND ANIMAL CARE $318,886
20.608 MINIMUM PENALTIES FOR REPEAT OFFENDERS FOR DRIVING WHILE INTOXICATED $261,021
93.150 PROJECTS FOR ASSISTANCE IN TRANSITION FROM HOMELESSNESS (PATH) $259,878
93.043 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART D, DISEASE PREVENTION AND HEALTH PROMOTION SERVICES $258,125
97.067 HOMELAND SECURITY GRANT PROGRAM $240,000
16.036 COMPREHENSIVE FORENSIC DNA ANALYSIS GRANT PROGRAM $221,851
93.472 TITLE IV-E PREVENTION PROGRAM $205,500
10.561 STATE ADMINISTRATIVE MATCHING GRANTS FOR THE SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM $203,132
93.493 CONGRESSIONAL DIRECTIVES $176,213
93.071 MEDICARE ENROLLMENT ASSISTANCE PROGRAM $167,793
16.835 BODY WORN CAMERA POLICY AND IMPLEMENTATION $164,430
15.226 PAYMENTS IN LIEU OF TAXES $162,565
16.040 MATTHEW SHEPARD AND JAMES BYRD, JR. HATE CRIMES EDUCATION, INVESTIGATION AND PROSECUTION PROGRAM $147,180
93.747 ELDER ABUSE PREVENTION INTERVENTIONS PROGRAM $145,138
16.839 STOP SCHOOL VIOLENCE $139,709
93.558 TEMPORARY ASSISTANCE FOR NEEDY FAMILIES $138,560
97.012 BOATING SAFETY FINANCIAL ASSISTANCE $134,274
93.323 COVID- 19 EPIDEMIOLOGY AND LABORATORY CAPACITY FOR INFECTIOUS DISEASES (ELC) $129,248
93.977 SEXUALLY TRANSMITTED DISEASES (STD) PREVENTION AND CONTROL GRANTS $128,292
16.742 PAUL COVERDELL FORENSIC SCIENCES IMPROVEMENT GRANT PROGRAM $122,674
20.600 STATE AND COMMUNITY HIGHWAY SAFETY $120,341
93.052 COVID- 19 NATIONAL FAMILY CAREGIVER SUPPORT, TITLE III, PART E $113,508
93.042 SPECIAL PROGRAMS FOR THE AGING, TITLE VII, CHAPTER 2, LONG TERM CARE OMBUDSMAN SERVICES FOR OLDER INDIVIDUALS $112,983
20.939 SAFE STREETS AND ROADS FOR ALL $103,954
93.090 GUARDIANSHIP ASSISTANCE $101,253
10.555 NATIONAL SCHOOL LUNCH PROGRAM $85,520
16.U01 OC REGIONAL COMPUTER FORENSICS LABORATORY (OCRCFL) $77,877
10.553 SCHOOL BREAKFAST PROGRAM $74,726
93.603 ADOPTION AND LEGAL GUARDIANSHIP INCENTIVE PAYMENTS PROGRAM $69,146
16.838 COMPREHENSIVE OPIOID, STIMULANT, AND OTHER SUBSTANCES USE PROGRAM $55,843
93.324 STATE HEALTH INSURANCE ASSISTANCE PROGRAM $54,494
21.032 LOCAL ASSISTANCE AND TRIBAL CONSISTENCY FUND $52,082
10.576 SENIOR FARMERS MARKET NUTRITION PROGRAM $44,000
93.041 SPECIAL PROGRAMS FOR THE AGING, TITLE VII, CHAPTER 3, PROGRAMS FOR PREVENTION OF ELDER ABUSE, NEGLECT, AND EXPLOITATION $39,498
93.045 COVID- 19 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $38,066
10.665 SCHOOLS AND ROADS - GRANTS TO STATES $31,720
16.U02 ORANGE COUNTY DRUG ENFORCEMENT TASK FORCE $21,741
16.U03 ORANGE COUNTY ALCOHOL, TOBACCO, FIREARMS & EXPLOSIVES TASK FORCE $17,787
93.323 EPIDEMIOLOGY AND LABORATORY CAPACITY FOR INFECTIOUS DISEASES (ELC) $17,728
16.738 EDWARD BYRNE MEMORIAL JUSTICE ASSISTANCE GRANT PROGRAM $13,109
97.106 SECURING THE CITIES PROGRAM $12,577
21.016 EQUITABLE SHARING $5,144
14.U01 FSS ESCROW FORFEIT PROGRAM $2,008
14.218 COVID- 19 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $384