Finding Text
Finding # 2025-002 Type: Significant deficiency in internal controls over federal program compliance (Reporting) Assistance Listing Number: U.S. Department of Treasury 21.027 American Rescue Plan Act – Coronavirus State and Local Fiscal Recovery Plan Funds Requirement: Pursuant to 2 CFR §200.303, Macdonald Center dba Maybelle Center is required to establish and maintain effective internal controls over compliance with federal award requirements, including controls to ensure reports submitted to grantors are reviewed for accuracy and completeness and that evidence of such reviews is retained. Condition: Macdonald Center dba Maybelle Center did not maintain evidence of supervisory review for quarterly reports submitted to the grantor. Although reports were submitted timely, documentation demonstrating management's review and approval of the information prior to submission was not consistently retained. Context: During testing of reports submitted to grantors, we noted that supporting documentation did not include evidence of management review and approval. As a result, we were unable to verify that a review control had been performed prior to submission. Cause: Established procedures do not require retention of documentation demonstrating management's review and approval of reports submitted to grantors, and review activities were not consistently evidenced. Effect: Without documented review procedures, errors or omissions in reports submitted to grantors may not be identified and corrected prior to submission, which could affect the accuracy and completeness of information reported. Questioned Costs: Not applicable. Recommendation: We recommend that management implement procedures requiring documented review and approval of all reports submitted to grantors. Evidence of review, such as signatures, initials, dated approvals, or electronic workflow approvals, should be retained to demonstrate that reports have been reviewed for accuracy, completeness, and compliance with grant requirements prior to submission. Management’s Response: Management agrees with the finding and will enhance existing reporting procedures to require documented evidence of review and approval for reports submitted to grantors. Macdonald Center dba Maybelle Center will retain documentation of supervisory review and approval as part of its grant compliance files going forward.