Finding Text
Section III – Major Federal Awards Programs – Findings and Questioned Costs (Cont.) Finding 2025-008: Activities Allowed or Unallowed / Allowable Costs - Lack of Segregation of Duties in Expenditure Determination and Approval (Material Weakness) Federal Program : Grants for Transportation of Veterans in Highly Rural Areas Assistance Listing Number : 64.035 Criteria: As per 2 CFR 200.303(a), entities must maintain effective internal controls, including segregation of duties, to prevent unauthorized or inaccurate transactions. Condition: The same individual was responsible for determining expenditure allowability and approving expenditures for reimbursement. Cause: Staffing limitations and the absence of written policies resulting in inadequate role separation. Effect: Insufficient segregation of duties increases the risk of errors or inappropriate expenditures. Recommendation: Management should reassign roles so that expenditure allowability reviews and expenditure approvals are performed by separate individuals. If staffing is limited, implement compensating management review controls. Repeat Finding: This is a repeat finding.