Finding Text
Finding 2026-003: Grant Account Reconciliation Procedures Type of Finding: Control U.S. Department of Housing and Urban Development Direct program Assistance Listing Number: 14.251 Award Numbers: B-24-CP-MI-1149 Award Year End: August 31, 2032 Specific Requirement: (C.) Cash Management Criteria: Section 200.302(b)(3) of the Cost Principles of the Title 2 U.S. Code of Federal Regulations Part 200—Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) indicates that a non-federal entity must provide records that adequately identify the source and application of funds for federally-funded activities. These records must contain information pertaining to federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Questioned Costs: None. Condition: During our review of the Township’s controls over the monitoring of grant activity, we noted that the Township did not have adequate procedures to track disbursements by grant. Context: The Township has multiple grants for a single project. While examining eligible grant disbursements, we noted that the Township does not have adequate controls in place to allocate these disbursements to the various grants. Effect: Inadequate controls surrounding the allocation of eligible grant expenditures could cause the Township to inadvertently allocate the same disbursement to multiple grants. Cause: The Township is a small entity with limited experience in handling large federal grants and overseeing capital asset activity of this size with multiple funding sources. Repeat Finding: See Finding 2025-003 for a similar finding reported during the single audit for the year ended March 31, 2025. Recommendation: The Township should establish procedures to verify that expenditures are properly tracked by each individual grant to ensure that individual disbursements are not allocated to more than one grant. Views of Responsible Officials: The Township agrees with this finding.