Finding 1240076 (2021-001)

Federal Agency: Department of Treasury Pass-Through Entity: Executive Office of Administration and Finance & Massachusetts Department of Elementary and Secondary Education Award Name: Coronavirus Relief Fund Assistance Listing Number: 21.019 Compliance Requirement: Reporting Type of Finding: Compliance Internal Control over Compliance – Material Weakness Criteria: According to Uniform Guidance 2 CFR 200.303, the non-federal entity must establish and maintain effective internal controls over compliance for federal awards to provide reasonable assurance of compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Condition and Context: During fiscal year 2021, the City charged the Coronavirus Relief expenditures to multiple funds in the general ledger. The fiscal year 2021 SEFA omitted $6,174,406 of expenditures from one fund from the SEFA. The error only extended to the amounts reported on the SEFA, amounts reported to the pass-through entities were correct. Cause: The lack of reconciliation to the general ledger during the preparation and review process. Effect: The SEFA and major program were materially understated. Questioned Costs: None. Recommendation: We recommend the City enhance their internal controls over the preparation of the SEFA to ensure those preparing and reviewing the reports have the appropriate understanding and information needed to ensure completeness and accuracy of information being reported. Views of Responsible Officials: See corrective action plan.