Finding Text
Finding 2021-007 Lack of Internal Controls Over Activities Allowed or Unallowed and Allowable Costs/Cost Principles Federal Agencies: U.S. Department of the Treasury Federal Programs: Coronavirus Relief Fund (CRF) and Coronavirus State and Local Fiscal Recovery Funds (CSLFRF), respectively ALN Numbers: 21.019 and 21.027, respectively Award Number: SLT0591/0845/1405 and SLFRP2520/4574, respectively Award Year: 2020 and 2021, respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Per OMB Section 200.403(a), costs should be necessary and reasonable for the performance of the federal award. Condition and Context: The Community could not provide adequate supporting documentation for costs charged to the programs. During our review of non-payroll costs charged to the CRF program, the Community could not provide supporting documentation (invoice, check request, or management approval) for 2 of the 8 non-payroll transactions charged to the program. During our review of non-payroll costs charged to the CSLFRF program, the Community could not provide supporting documentation (invoice, check request, or management approval) for 9 of the 18 non-payroll transactions charged to the program. Cause: Lack of internal controls over supporting documentation and approval over expenditures charged to the programs. Effect: Lack of internal control over cash disbursements pose the risk that the Community will expend federal funds for non-grant purposes. Questioned costs: Actual and likely questioned costs are estimated to be below the reporting threshold of $25,000. Repeat finding: This is a repeat of Finding 2020-008, therefore, we believe this to be a systemic issue. Recommendation: We recommend that management implement policies and procedures to ensure that only allowable costs are charged to the program and that supporting documentation be retained as records for all transactions. Management Response: Management agrees with this finding, see Corrective Action Plan.