Finding Text
Information on the federal program: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds (SLFRF), Assistance Listing Number 21.027, U.S. Department of the Treasury Criteria: The 2 CFR § 200.303 requires that non-Federal entities establish and maintain effective internal control over the Federal award that provides reasonable assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, the SLFRF Compliance and Reporting Guidance requires recipients to maintain records and financial documents for a period of five years after all funds have been expended or returned to Treasury, which includes documentation of the reports submitted. Condition: During our testing of the quarterly Project and Expenditure (P&E) reports submitted to the U.S. Department of the Treasury, the County was unable to provide documentation or audit logs from the Treasury Portal demonstrating the internal review and approval process. Specifically, the County could not provide evidence of: • The identity of the individual who prepared the report. • The identity of the supervisor/official who reviewed and authorized the submission. • The specific date and time the reports were submitted. Due to significant staff turnover, the login credentials and historical "submission confirmation" records were not maintained or accessible for the audit period. Context/Cause: The County experienced turnover in key administrative positions responsible for ARPA grant management. The departing staff did not transition portal access or download the "Submission Summary" reports prior to their departure, and the County did not have a secondary process to archive these records outside of the portal. Effects: Without evidence of a formal review and approval process, there is an increased risk that inaccurate or unauthorized financial data could be reported to the Federal government. This lack of documentation constitutes a significant deficiency in internal controls over the reporting compliance requirement. Recommendation: The County should strengthen its internal controls over Federal reporting by archiving submissions, utilizing formal approval logs, and implementing succession planning. Auditee’s Response: We concur with the finding