Finding Text
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Economic Development Initiative, Community Project Funding, and Miscellaneous Grants Assistance Listing Number: 14.251 Pass-Through Agency: N/A Pass-Through Numbers: N/A Award Period: 8/13/2024 – 8/31/2032 Type of Finding: Material Weakness in Internal Control over Compliance Condition: The Organization was unable to provide documentation supporting the amounts included in reimbursement requests submitted under the Federal award. In addition, there was no evidence that reimbursement requests were independently reviewed for accuracy and completeness prior to submission. Criteria: Pursuant to 2 CFR § 200.329, non-Federal entities are responsible for monitoring activities under Federal awards to ensure compliance with applicable Federal requirements and to maintain sufficient oversight of Federal award operations. Such oversight includes maintaining adequate documentation to support reimbursement requests submitted to the grantor and implementing appropriate review controls over those requests. Cause: The Organization has not established or implemented formal policies and procedures governing the preparation, review, approval, and retention of documentation related to Federal reimbursement requests. Effect: Without adequate supporting documentation and evidence of supervisory review, the Organization cannot demonstrate that reimbursement requests were accurate, allowable, and consistent with Federal award requirements. This increases the risk of errors, unsupported costs, and noncompliance with Federal regulations. Repeat Finding: No Recommendation: We recommend that management establish and implement policies to retain proof of amounts requested for reimbursement. Views of responsible officials: There is no disagreement with the audit finding.