Finding Text
2024-002 Disposition of Federally Funded Assets Year Finding Originated: 2024 Criteria: In accordance with 2 CFR 200.313(e), when original or replacement equipment acquired under a federal award is no longer needed for the original project or program, the non-federal entity must request disposition instructions from the federal awarding agency if the item’s fair market value exceeds $10,000. Additionally, if the asset is sold, the federal awarding agency is entitled to an amount calculated by multiplying the percentage of the federal agency’s contribution toward the original purchase by the current market value or proceeds from the sale. Condition: The Parish disposed of equipment purchased under a U.S. Department of Homeland Security grant (ALN No. 97.039) without following the disposition procedures described above. Cause: In April 2024, the Parish finalized the sale of its sewer assets held in the Parish’s Utility Fund. The final asset listing included assets that were acquired by the Parish between the time the initial sale proposal was made, and the final sale was completed. The assets included equipment purchased with federally funded grants. The Parish did not properly contact the federal agency prior to the sale of the assets to request disposition instructions from the federal awarding agency. Effect: The Parish may not be compliant with 2 CFR 200.313(e). Recommendation: We recommend that Parish implement procedures to ensure that surplus assets are identified as federally funded prior to disposition or sale, and the Parish request disposition instructions from the federal awarding agency as required by 2 CFR 200.313(e). Views of responsible officials: See management’s corrective action plan following the summary of noncompliance items.