Finding Text
Finding 2025-004 – Reporting Federal Program: Coronavirus State and Local Fiscal Recovery Funds ALN: 21.027 Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control Over Compliance and Noncompliance Criteria Per 2 CFR §200.328, non-Federal entities must submit financial and performance reports that are accurate, current, and complete. Additionally, per 2 CFR §200.303, entities must maintain effective internal control over Federal awards. Treasury SLFRF guidance requires Project and Expenditure (P&E) Reports to provide complete and accurate project information. Condition The Town’s March 2025 Project and Expenditure Report contained a project description that revenue replacement funds were used on payroll costs, when the costs were construction related. This error was not identified prior to submission. Cause The condition resulted from insufficient review of financial and narrative reporting elements. Effect The report submitted to Treasury was not accurate, resulting in noncompliance with federal reporting requirements. Questioned Costs None. Repeat Finding No. Recommendation We recommend the Town strengthen controls over SLFRF reporting by establishing documented review and approval controls, ensuring alignment between project descriptions and actual use of funds, and providing training on reporting requirements. Views of Responsible Officials Management agrees with the finding and will strengthen review procedures to ensure financial and narrative reports are accurate, complete, and consistent with underlying records.