Finding Text
FINDING REFERENCE NUMBER 2024-034 (See Finding Reference Number 2024-013) FEDERAL PROGRAMS (ALN – 93.568) LOW-INCOME HOME ENERGY ASSISTANCE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES AWARD NUMBERS 2301PRLIEA (Federal Award Year: 10/1/2022 – 9/30/2024) 2301PRLIEE (Federal Award Year: 10/1/2022 – 9/30/2024) 2301PRLIEI (Federal Award Year: 10/1/2022 – 9/30/2024) ADMINISTRATION ADMINISTRATION FOR SOCIOECONOMIC DEVELOPMENT OF THE FAMILY (ADSEF, BY ITS SPANISH ACRONYM) COMPLIANCE REQUIREMENT PERIOD OF PERFORMANCE TYPE OF FINDING INTERNAL CONTROL AND COMPLIANCE – MATERIAL WEAKNESS AND MATERIAL NONCOMPLIANCE CRITERIA In accordance with 45 CFR Subtitle A, Subchapter A, Part 96, section 96.14, establishes that the time period for obligation and expenditure of grant funds, a maximum of 10 percent of the amount payable to a grantee may be held available for the next fiscal year. No funds may be obligated after the end of the fiscal year following the fiscal year for which they were allotted. STATEMENT OF CONDITION As part of our audit procedures over the period of performance requirement, we obtained the reports SF-425 for FY2301 for LIEA, LIEE and LIEI for the quarter ended September 30, 2023. In relation to the LIEA grant, the amount of $10,297,734.58 was reported as unobligated balance, representing the 57% of the grant. For the LIEE and LIEI grants, the 100% ($9,014,770 and $450,147) were reported as unobligated balance. QUESTIONED COSTS None. PERSPECTIVE INFORMATION This is a systemic deficiency. We interviewed the person responsible for submitting the reports in relation to this deficiency, she provided evidence of all reports amended and submitted on April 11, 2024. She indicated that the federal liaison allowed the amendments, because at September 30, 2023, she had no evidence of funds obligated in order to comply with the requirement of the program. We requested evidence of communication with the Federal agency, but no evidence was provided. STATEMENT OF CAUSE Although the person responsible for submitting the reports monitors the activities related to this requirement, there are no processes in place to communicate potential non-compliance with the requirement, and no action plans to follow to ensure that the funds are properly obligated before the end of the first year of the grants. POSSIBLE ASSERTED EFFECT ADSEF is not in compliance with the requirements related to the period of performance. The noncompliance may result in a decrease in funds allocated to the program. IDENTIFICATION OF REPEAT FINDING No reported as prior audit finding. RECOMMENDATIONS We recommend that management establish appropriate internal controls to ensure that funds are being obligated within the required time period, and in the event of any anticipated noncompliance with this requirement, notify the federal government in writing and maintain documentation regarding approvals.