Finding 1238407 (2025-002)

Finding 2025-002 Identification of the federal program: 21.027 - Coronavirus State and Local Fiscal Recovery Funds Noncompliance and Significant Deficiency in internal controls over cutoff of expenditures reported on the schedule of expenditures and federal awards Criteria: 2 CFR 200.510(b) requires that the Schedule of Expenditures of Federal Awards (SEFA) present total Federal awards expended in the fiscal year. Condition: The Cooperative’s SEFA for the fiscal year ended December 31, 2025 included federal award expenditures related to the prior fiscal year, resulting in improper cut-off of expenditures reported. Cause: The entity did not have adequate controls in place to ensure that only expenditures incurred within the current fiscal year were included in the SEFA. Effect: The current year SEFA included prior year expenditures, resulting in an overstatement of the expenditures reported on the SEFA in the current year. Questioned costs: None Recommendations: The entity should implement and document procedures to ensure proper cut-off of federal award expenditures, including a review of supporting documentation to verify expenditures are recorded in the correct fiscal period prior to preparation of the SEFA. Additionally, management should perform a detailed review of the SEFA before submission to ensure completeness and accuracy. Views of responsible officials: Management understands and agrees with the finding. Management will ensure that appropriate controls surrounding cut-off of federal award expenditures are in place to comply with any future grants.